** China's blue-chip CSI300 index added 0.99% by the lunch break, while the Shanghai Composite Index gained 1.56%. During early trade, it briefly rose above the 3,400 level — the highest in ten months.
** Hong Kong benchmark Hang Seng Index was up 0.75% and the Hang Seng China Enterprises Index rose 0.92%.
** Asian shares crept higher as investors braced for a week when U.S. inflation data will test wagers the next move in interest rates will be down, while worries about a possible credit crunch weighed on the dollar.
** "Chinese banks and insurance stocks bolstered the Shanghai blue-chip index, as investors are pinning on hopes that China's consumption recovery would benefit banks' profit this year," said Kenny Ng, a strategist at China Everbright Securities International.
** Shanghai-listed state-owned banks such as Industrial and Commercial Bank of China , up 6%, and Agricultural Bank of China rose 5.8%.
** State-owned financial stocks account for 15%-20% of the Shanghai Composite and CSI300 index weighting and nearly half of A-share earnings, according to a Bank of America report published last week.
** "State-owned banks are defensive and our preferred exposure in the current volatile market," said Bank of America.
** Household consumption per capita rose 5.4% in Q1,
compared with a year ago, up from 2.4% year-on-year increase in
Q4, according to a Goldman Sachs report. The increase was led by
a strong services consumption rebound.
** In Hong Kong, HSBC shares rose 1.37%, the
highest in two months. Last Friday, it defeated a proposal
backed by its biggest Asian shareholder Ping An to break-up the
bank and spin-out its lucrative Asian business at its annual
investor meeting in Birmingham in England.
** The Hang Seng Mainland Oil & Gas Index rose
4.19%.
(Reporting by Hong Kong Newsroom; editing by Uttaresh
Venkateshwaran)
