The biggest two-day rally in the Hong Kong-traded shares of Chinese companies since 2008 signals mainland stocks may rise after a one-week holiday on speculation inflation is slowing and the European debt crisis may be contained.
Air China Ltd. and China Petroleum & Chemical Corp. are among companies withholding 20 percent of dividend payments to foreigners as they await guidance on how to handle the unwinding of a 17-year-old tax exemption.
Asian stocks fell, sending the regional benchmark index to its longest losing streak in three months, as oil surged above $100 a barrel for the first time in two years amid escalating conflict in the Libya.
China stocks fell, dragging the benchmark index to a five-week low, as investors speculated the nation’s economic expansion may weaken at the same time as the government maintains lending curbs to avert asset bubbles.
SouFun Holdings Ltd., the operator of China’s biggest property website, posted the second-largest first-day gain for a U.S. initial public offering this year after raising $125 million selling shares at the top of its price range.