Yesterday, the Hong Kong market finally broke out after entering the doldrums for more than one week. Over night, the US Federal Reserve announced maintaining the current near zero interest-rate environment for a considerable period. Stock markets advanced on the news. Asian markets rose and Hong Kong followed. Interest rate sensitive stocks rose. Sun Hung Kai Properties gained 4%. Crude oil rose sharply. Resources rose. Chalco gained 4.2% to lead the blue chips. The Hang Seng index rose 361 points and H share index 291 points. Turnover increased to $65.8 billion. Over night, European and American markets rose. Dow Jones gained 47 points. Hong Kong stocks were mixed in New York. We expect the market to consolidate today.

Stock Picks

CR Gas (01193) The Group reported a 62% rise in 2009 earnings to RMB 422 million. The Group’s strategy is growth through acquisition. The Group has cash on hand of RMB2.22 billion, enough to do some major acquisitions.

Buy $11.30 Target $13.00 Cut loss $10.00

Richfield (08136) The Legislative Council passed the law, lowering the threshold for compulsory auction of old tenement buildings from 90% to 80%. The new law will help the Group’s acquisition of old properties.

Buy $0.64 Target $1.00, Cut loss $0.60