Hong Kong shares close lower on profit-taking in China stocks, properties UPDATE

Hong Kong shares close lower on profit-taking in China stocks, properties UPDATE

	Published : Thu, 25 Jan 2007 10:28 By : Agencies Print this Story

HONG KONG (XFN-ASIA) - Share prices closed lower as investors stepped up profit-taking in late trade, with China stocks and property firms particularly hit following recent strong gains, dealers said.

They said there were concerns that many stocks have become expensive following the market's run-up to near the 21,000 points level.

The Hang Seng Index closed down 151.22 points or 0.73 pct at 20,669.83, off a low of 20,610.22 and high of 20,897.55.

Turnover was 51.77 bln hkd.

The Hang Seng China Enterprises Index was down 148.26 points or 1.48 pct at 10,012.57.

'Sentiment has turned cautious following strong gains recently. H-shares and property counters were hit the most after leading the (market's) gains early this week,' said Jackson Wong, investment manager at Tanrich Securities.

Wong said sentiment for H-shares was affected by a sharp drop in the A-share market in Shanghai amid concerns the Chinese government will implement further macroeconomic controls to cool its economy and to limit liquidity flows into the financial markets.

'I think A-share performance is having a more obvious impact on H-shares now and vice-versa compared before. The fall in A shares today led the H shares to shed more than 100 points,' he added.

The benchmark Shanghai Composite Index, which covers both A- and B-shares listed on the Shanghai Stock Exchange, today closed down 117.76 points or 3.96 pct at 2,857.37, the largest single-day slump since July 13 last year.

Dealers said that investors were also inclined to lock in profits amid worries over possible fund-raising exercises by some companies to take advantage of the current high share prices in Hong Kong.

Among blue chips, China Mobile fell 1.35 hkd or 1.74 pct at 76.15, Hutchison Whampoa was down 0.85 hkd or 1.05 pct at 79.85 and Swire Pacific down 0.05 hkd or 0.05 pct at 94.0.

Properties were mostly lower, with Cheung Kong losing 1.40 hkd or 1.34 pct at 102.70, Henderson Land down 1.10 hkd or 2.35 pct at 45.80, Sun Hung Kai Properties down 0.55 hkd or 0.56 pct at 97.05 and Sino Land down 0.16 hkd or 0.84 pct at 19.0.

The property sub-index was down 243.05 points or 0.97 pct at 24,814.87.

Banks were mostly lower, with HSBC up 0.60 hkd or 0.42 pct at 144.10, Hang Seng Bank down 1.0 hkd or 0.91 pct at 108.60, Bank of East Asia down 0.95 hkd or 2.07 pct at 45.0 and BOC Hong Kong down 0.55 hkd or 2.56 pct at 20.90.

Among China stocks, China Life was down 0.70 hkd or 2.94 pct at 23.15, Bank of China down 0.01 hkd or 0.25 pct at 3.99 and PetroChina was flat at 9.85 hkd, while China Unicom was up 0.12 hkd or 1.12 pct at 10.86 and Angang New Steel was up 0.10 hkd or 0.77 pct at 13.06.

(1 usd = 7.8 hkd)

leonora.walet@xfn.com

lw/rc