HK developers advance ahead of city’s budget speech

Hong Kong property stocks extended gains ahead of the city’s annual budget speech today, as some analysts anticipated announcements that would benefit developers.

Property companies were the biggest gainers on the Hang Seng Index, with Sun Hung Kai Properties Ltd. climbing almost 3 percent and Henderson Land Development Co. advancing 1.4 percent.

“People have gotten slightly more optimistic on sales – prices have been ticking up and we saw 22 bidders for a redevelopment project in Central,” said David Millhouse, China head at Forsyth Barr Asia Ltd. There is speculation land supply unveiled in today’s budget will be less than expected, which “would be positive for the major developers, who have strong project pipelines.”

The budget speech will be delivered by Financial Secretary Paul Chan, who took the position last month after John Tsang resigned to run for the position of Hong Kong’s next chief executive. The government may reveal plans to offer 25 sites this year for the construction of about 19,000 private residential units, the Hong Kong Economic Times reported yesterday, without saying where it got the information.