[R]7:00 PM Hong Kong, 7:00 AM New York – China efforts to restrict speculative home lending appears to yield results as prices in the four large cities declined for the first time in seven months in July. Chinese regulators are also likely to tighten capital reserve calculations to curb lending. Resource stocks rose in Hong Kong and Shanghai.[/R]

The worldwide optimism after better than expected earnings in China, Japan, U.S. and India support a rise in commodities prices for the second week in a row. HSBC surged after it reported profit in the first half.

Hang Seng index in Hong Kong decreased 10.83 or 0.05% to 20,796.43 and CSI 300 index in China lower 0.42 or 0.01% to 3,786.62.

China mainland linked property companies declined after Shanghai Securities reported that property prices declined in the four largest cities in China in July.

Commodities and resource linked stocks gained as prices of copper, aluminum, zinc and steel and natural gas and crude oil increased.

Gainers & Losers

China Shenhua Energy Company surged 6.3% to 41.19 yuan and China Coal Energy Co increased 3.4% to 16.61 yuan.

Shanghai Airlines Company decreased 2.4% to 6.51 yuan after it estimated first half loss on weak demand and higher fuel prices.

GD Midea Holding Company increased 6.5% to 16.94 yuan after it completed offering of 189 million shares to raise 2.98 billion yuan.

Banks traded lower after the Wall Street Journal reported that China Banking Regulators may ask banks to exclude subordinated bonds from the calculation of available capital. The Journal did not name the source but the talks of tighter banking regulations have been making rounds in Shanghai and Hong Kong trading circles.

China Construction Bank Corp declined 1.8% to 6.42 yen and Industrial & Commercial Bank of China decreased 2.2% to 5.28. Bank of China declined 2.8% to 3.79 yuan.

HSBC Holdings Plc increased 7% to HK$83.10 after it reported net profit surprising most analysts. HSBC loan loss reserve in the first half was increased by $13.9 billion and higher revenues and profits in the securities underwriting unit contributed to the earnings of $3.35 billion compared to $7.72 billion.

China overseas Land decreased 4.5% to HK$18.54 and Hang Lung Properties Ltd declined 3.4% to HK$27.35 after properties prices declined in China.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 22.54 or 0.22% to 10,375.01, Hang Seng index in Hong Kong decreased 10.83 or 0.05% to 20,796.43 and CSI 300 index in China lower 0.42 or 0.01% to 3,786.62. ASX 200 index in Australia increased 45.90 or 1.08% to 4,309.30. The FTSE Bursa KL Composite index in Malaysia closed higher 8.57 or 0.73% to 1,179.88.

The Kospi Index in South Korea increased 1.39 or 0.09% to close at 1,566.37. SET index in Thailand closed lower 0.20 or 0.03% to 641.23 and JSE Index in Indonesia increased 21.30 or 0.91% to 2,360.09. The Sensex index in India decreased 93.25 or 0.59% to 15,830.98.