HK shares seen higher on Wall Street rally

HONG KONG, May 19 - Hong Kong shares are seen moving higher for a third straight session on Tuesday after Wall Street stocks rose overnight on signs the U.S. economy was on the road to recovery.

Stocks in the U.S. and major Asian markets were boosted by better-than-expected results for home retailing giant Lowe's Cos Inc, which seemed to suggest the recession in the world's largest economy may be easing.

Commodity counters are also seen gaining on Tuesday after crude prices rose nearly 5 percent to a six-month high as violence in top African crude exporter Nigeria and a fire at a key U.S. East Coast refinery revived supply concerns.

Shipping stocks are likely to be big movers after the Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, hit a fresh 2009 high on Monday powered by Chinese demand for iron ore, coal and grains.

The benchmark Hang Seng Index reversed course to finish 1.4 percent higher at 17,022.91 on Monday led by Chinese counters after the Shanghai market rose in a bout of late-session buying while local property stocks jumped on hopes of a recovery. STOCKS TO WATCH

* China's cabinet has given approval to Bank of East Asia and HSBC Holdings to issue yuan bonds in Hong Kong, the official Financial News reported on Tuesday.

The local Chinese incorporated units of the two banks would be the first banks to receive such approvals from the State Council, the newspaper quoted unnamed central bank officials as saying.

The move would not only give HSBC, Europe's biggest bank, and Bank of East Asia another source for yuan financing, it was also aimed at helping the development of Hong Kong as a financial centre and boosting investor confidence, said the paper.

* China Resources Land Ltd on Tuesday said it would sell HK$4.3 billion (US$551 million) worth of new shares to a major shareholder, raising capital for future acquisitions for its land bank and for working capital.

The Chinese property company said it would sell 300 million new shares at HK$14.34 each to its major shareholder, Gain Ahead Group Ltd, a unit of China Resources (Holdings) Co Ltd, after the shareholder completed a sale of the same amount of existing shares at the same price to third-party investors.

The placing price represented a 6.03 percent discount to the closing price of HK$15.26 on Monday. Completion of the placing is expected to be on May 21. Credit Suisse is the book runner for the deal. ----------------------MARKET SNAPSHOT @ 2244 GMT ------------

INSTRUMENT LAST PCT CHG NET CHG S&P 500 <.SPX> 909.71 3.04% 26.830 USD/JPY <JPY=> 96.37 0.15% 0.140 10-YR US TSY YLD <US10YT=RR> 3.2337 -- 0.000 SPOT GOLD <XAU=> 917.1 -0.01% -0.100 US CRUDE <CLc1> 59.18 0.25% 0.120 DOW JONES <.DJI> 8504.08 2.85% 235.44 ASIA ADRS <.BKAS> 108.31 3.21% 3.37 -------------------------------------------------------------

MARKETS SUMMARY *Wall St gains as Lowe's lifts mood on economy [nN18371919] *Oil up 4.8 percent on Nigeria, US refinery fire [nSYD478805] *Treasury bonds trim losses after housing data [nN18486749] *Dollar up vs yen on stocks, Japan comments [nN18293838]