* HSI +2.9 pct, H-shares +4 pct, China shut until Friday
* HSI breaks above 22,800 resistance in strong turnover
* Shares linked to China financial sector reform strong
* Sands China jumps after record monthly Macau gambling
By Clement Tan
HONG KONG, Jan 2 (Reuters) - Hong Kong shares kicked off the
new year by closing at a 19-month high on Wednesday, as
investors cheered the passage of a bill in the United States
Congress that averted a fiscal crisis and eased worry of a
recession in the world's largest economy.
Investors chased gains in China growth-sensitive counters
that were laggards in 2012 and thematic plays such as non-bank
financials and property that are expected to outperform this
year. Bourse turnover was at its highest since Dec. 18.
The Hang Seng Index climbed 2.9 percent to 23,312
points, its highest since June 2011 and decisively breaking
above chart resistance at around 22,800 that has stymied gains
for much of the previous two weeks.
The China Enterprises Index of the top Chinese
listings jumped 4 percent in its best daily gain in a year,
closing at its highest since August 2011.
Gains on Wednesday accelerated after the United States
averted economic calamity when lawmakers approved a deal to
prevent huge tax hikes and spending cuts that would have pushed
the country into recession.
"In the short term, this may trigger some reversal of flows
back to the U.S., but the effects of that will probably be
offset by flows from Japan as the yen continues to weaken," said
Hong Hao, chief equity strategist at Bank of Communications
"There's also an element of catch up today as people begin
to return from their holidays and realise they have missed out
on the December rally in the China market," Hong added.
An 18 percent gain in December, its best monthly showing
since July 2009, helped the CSI300 of the top Shanghai and
Shenzhen listings to its first annual gain in three. Mainland
markets were shut on Wednesday and will resume trade on Friday.
On Wednesday, Chinese steel producer Citic Pacific
surged 11.4 percent to its highest since April 2012. It had
finished 2012 down 17.4 percent and underperformed the Hang Seng
Index's 23 percent jump.
Chinese sportswear brands Li Ning and Anta Sports
, which fell 18.3 and 25.7 percent in 2012
respectively, each soared 11.9 and 8 percent on Wednesday.
The annual declines in 2012 were Citic Pacific's and Li
Ning's third-straight annual loss, and the second year of loss
for Anta Sports.
Aluminum Corporation of China (Chalco) jumped 6.2
percent to return to levels not seen since May 2012. It had
finished 2012 up 5 percent, failing to retain much of its gains
from early last year.
Metallurgical Corp of China Ltd gained 6.6 percent
after the company said it would transfer its 51.06 percent
equity interest in loss-making Huludao Nonferrous Group to its
CHINA THEMATIC PLAYS STRONG
Chinese financials were strong after China's official
manufacturing purchasing managers' index held steady in December
at 50.6, matching November's seven-month high, that pointed to
steadying growth recovery in the world's second-largest economy.
But non-banking financial counters outperformed, with China
Life Insurance rising 6.7 percent, extending strong
2012 gains on hopes that financial sector reforms in the
mainland will benefit insurers and brokerages.
New China Life Insurance spiked 12.6 percent in
its best daily gain since it made its Hong Kong listing debut in
The mainland's securities regulator had said over the
weekend that it plans to allow eligible securities houses and
insurers' asset management units to develop and manage mutual
funds in a bid to reinvigorate an industry struggling to produce
returns for investors.
This follows an announcement last week allowing brokerages
to sell subordinated debt and the Chinese central bank pledging
to quicken the pace of reform in the financial sector that sent
shares of Chinese brokerages soaring last Friday.
Citic Securities, China's largest listed
brokerage, jumped 6.1 percent to close at a record high after
posting a 53 percent gain in 2012.
Financial sector reforms in China are expected to stay a
dominant theme in 2013, analysts say, as would Chinese
urbanisation-related counters such as property developers, which
were also stronger on Wednesday.
But in a sign that such hopes may not extend sector-wide,
Country Gardens ended up 2 percent, paring gains after
its nine-month net profit showed the property developer posting
a 34.4 percent rise in profit from a year earlier.
The Macau gaming sector extended gains after data showed
monthly Macau gaming revenue hitting a record high in December.
Sands China jumped 5.3 percent.