CITIC Pacific is up 12.86% today, closing at HKD 8.25. The company has issued an announcement saying that they are not aware of any reason for the huge increase today.
There are actually two possible reasons for the increase. First, tomorrow CITIC Pacific will hold a EGM (Extraordinary General Meeting) for all shareholders for approving the rescue transaction between the Company and its parent, CITIC Group that was revealed back in November (http://www.hkfinancialnews.com/?p=96). There is no doubt that this will be approved tomorrow as it is beneficial to the Company.
Secondly, AUD has actually risen back a lot in the past few days. Currently it is trading at 1 AUD = 0.70 USD, much higher than the rate a month ago at around 1 AUD = 0.60 USD. The accumulator contracts that they have with banks will lose less money. On the other hand, it is the parent company, CITIC Group that will bear the loss if AUD drops further. So rising AUD is, in overall, good to CITIC group, but only neutral to CITIC Pacific. Therefore, rising AUD should not be a logical reason for the share price increase.
