6:00AM New York, 6:00 PM Hong Kong – Hong Kong stocks reverse earlier losses to close higher after the release of earnings from Chung Kong, Citic Bank, CNOOC and Hutchison.

Hong Kong stock averages rebounded from a slump in the morning session to close up in the wake of forecast-beating results from Cheung Kong and Hutchison.

Market sentiment

In Hong Kong trading Hang Seng Index regained from a 0.21% slump in the morning session to close up 0.21% or 47.21 to 22,664.22 and the China Enterprises Index of Hong Kong-listed mainland companies, or H shares, declined 0.26% or 31.38 to 11,828.84.

In Shanghai trading, the CSI Index fell 4.23% or 165.45 to 3,748.92.

Daily turnover on main-board turnover eased to HK$79.95 billion from HK$89.91 billion yesterday.

China National Petroleum to invest Rmb2 billion in Xinjiang

China Daily reported today that China National Petroleum Corporation reported yesterday that it plans to invest Rmb12 billion in its Dushanzi refinery in Xinjiang.

Construction of the project started in 2005 and CNPC expects to complete the refinery project in the third quarter this year and the ethylene project next year.

The project is expected to generate revenue of Rmb50 billion.

According to China Daily, analysts believe that the Dushanzi project will boost the local economy in the Xinjiang Uygur autonomous region and will help to ease domestic pressure for oil.

CNPC is also pursuing projects in the northeast, northwest and southern regions to increase its refining capacity. Currently, its refining project in Guangxi in the south is 90% complete.

The company is focusing on increasing production by 1 million tons and natural gas output by 11.5 billion cubic meters in 2008.

Statistics from the China Petroleum and Chemical Industry Association indicate that China refined 326.79 million tons of crude oil in 2007, an increase of 6.4% from a year earlier.

Gainers & Losers

Cheung Kong reported today that its annual profit increased to HK$27.68 billion beating the estimate of HK$25.50 billion from local analysts. Cheung Kong stock gained 1.57% to HK$110.10.

Hutchison’s profit after tax increased to HK$31.91 billion beating the forecast of HK$30 billion from telecom analysts. Hutchinson increased 0.89% to HK$73.70.

ICBC increased 1.31% to HK$5.42 after Bangkok Bank said it is still negotiating with the Chinese bank about the sale of its 19.3% stake in ACL Bank.

China CITIC Bank Corp jumped 3.84% to HK$4.06 on strong earnings that exceeded market forecast.

China Netcom Group Corp rose 3.07%to HK$21.85 after Merrill Lynch raised the stock to “buy” from “neutral”.