China shares crept towards three-week highs early Friday, with Hong Kong markets also modestly higher, ahead of more August data that could deepen optimism that the world's second-largest economy is on a sounder growth path.
Mainland Chinese share indexes were on track for a second-straight weekly gain, while the Hang Seng Index might have its biggest weekly gain in 21 months, thanks to investors rotating back into China equities after favourable macro data this week.
At midday, the Hang Seng benchmark inched up 0.3 percent at 22,654.4 points and was 4.2 percent up for the week, its best showing since the week ending Jan. 20, 2012. The China Enterprises Index of the top Chinese listings in Hong Kong was flat, but has still surged 5.2 percent this week.
The CSI300 of the leading Shanghai and Shenzhen A-share listings was up 0.2 percent, while the Shanghai Composite Index moved up 0.3 percent. They were up 1.4 and 1.5 percent on the week, respectively.
"Economic data will be the next key catalyst for further gains from here," said Cao Xuefeng, a Chengdu-based head of research for Huaxi Securities.
Beijing is due to release August trade data on Sunday, inflation on Monday, then industrial output, retail sales and urban investment on Tuesday. Money supply and loan growth data is expected from Sunday.
With Chinese companies starting to return to the markets to raise funds, there are concerns those efforts could sap limited money supply.
"As long as fund-raising efforts do not involve a public issuance of new shares or an altogether new offering, the market should not react too adversely," Cao added.
BBMG Corp shares jumped 5.6 percent in Shanghai and 3.2 percent in Hong Kong after the Chinese building material producer sold 501 million new A-shares to its parent and Beijing Guofa fund at 5.58 yuan per share.
This represents a 6.9 percent premium over its Aug. 21 closing price. Friday was the first day BBMG shares in both markets were trading since a suspension on Aug. 22. BBMG's successful fund raising came a day after China Merchants Bank announced their own success in Shanghai.
China Mobile climbed 1.3 percent to its highest in more than three months and has now risen more than 3 percent this week on hopes the largest mobile operator in the mainland has struck a deal with Apple Inc to offer the new iPhone model in China.
Apple has invited journalists to an event in Beijing on Sept. 11, shortly after it is expected to unveil its newest iPhone model in the United States. Apple supplier AAC Tech was flat on Friday, but has gained nearly 5 percent this week.
Chinese shippers were again strong after the semi-official Securities Times reported on Friday that the Shanghai free-trade zone has proposed easier rules on firms in the shipping industry.
China Shipping surged by the maximum 10 percent limit in Shanghai, while China Shipping Development gained another 2.5 percent and is now up nearly 14 percent on the week.
But Chinese property counters were hurt by a report in the Economic Information Daily that officials from seven second-tier cities including Nanjing and Zhengzhou met with the housing ministry to discuss rocketing home prices.
Poly Real Estate slid 2.7 percent in Shanghai. China Vanke shed 1 percent in Shenzhen after closing at its highest in almost two weeks on Thursday.
In Hong Kong, Shimao Property tumbled 3.8 percent, while China Resources Land and China Overseas Land each lost more than 1 percent.
Hubei Shuanghuan Science and Technology skidded 4.4 percent in Shenzhen when trade resumed after a two-day suspension. The inorganic chemical producer apologized for a toxic spill that killed thousands of river fish.
