Hong Kong shares end morning higher led by properties after Fed comments UPDATE

Hong Kong shares end morning higher led by properties after Fed comments UPDATE

	Published : Thu, 01 Feb 2007 06:42 By : Agencies Print this Story

HONG KONG (XFN-ASIA) - Share prices finished the morning session higher led by the property sector after the US Federal Reserve made reassuring comments on economic outlook after keeping interest rates unchanged as expected, dealers said.

They said the Fed's upbeat assessment overnight and Wall Street's subsequent gains lifted overall sentiment, with blue chips such as HSBC and China Mobile also posting gains.

But China stocks remained volatile amid concerns that the mainland markets may have overheated.

The Hang Seng Index ended the morning up 199.25 points or 0.99 pct at 20,305.67, off a low of 20,176.62 and high of 20,333.11.

Turnover was 27.7 bln hkd.

'The market received renewed buying interest after a correction (yesterday). There was bargain-hunting in hardest hit blue chips and H shares,' said Marco Mak, research head at Tai Fook Securities.

But he added that some China stocks continue to face selling pressure, which capped the market's upside.

Among China financials, China Construction Bank was down 0.07 hkd or 1.52 pct at 4.53, Bank of Communications down 0.15 hkd or 1.78 pct at 8.28, ICBC down 0.08 hkd or 1.77 pct at 4.45, Bank of China down 0.04 hkd or 1.04 pct at 3.82 and China Life was down 0.30 hkd or 1.32 pct at 22.50.

The Hang Seng China Enterprise Index was down 70.06 points or 0.73 pct at 9,532.34.

Among blue chips, China Mobile was up 1.25 hkd or 1.75 pct at 72.85, HSBC up 0.70 hkd or 0.49 pct at 143.0 and Hutchison Whampoa up 0.90 hkd or 1.16 pct at 78.50.

The property sector posted strong gains, with the sectoral index up 620.28 points or 2.54 pct at 24,997.11.

Cheung Kong gained 2.90 hkd or 2.8 pct at 105.70, Henderson Land rose 0.45 hkd or 1.0 pct to 45.55, Sun Hung Kai Properties added 2.55 hkd or 2.70 pct to 97.05 and Sino Land was up 0.24 hkd or 1.37 pct at 17.78.

Local banks were mixed, with Hang Seng Bank up 0.30 hkd or 0.28 pct at 108.80, Bank of East Asia down 0.35 hkd or 0.78 pct at 44.50 and BOC Hong Kong down 0.20 hkd or 0.98 pct at 20.20.

Lenovo was down 0.03 hkd or 0.95 pct at 3.14 on profit-taking after gaining 2.24 pct yesterday. The company is scheduled to announce its third quarter to December results today.

Mak said the launch of Vista operating system by Microsoft was a catalyst for the stock's gains yesterday as the new system is expected to stimulate demand for new PCs.

Citigroup said in a note that it expects Lenovo to report sales of 30.4 bln hkd and net profit of 299 mln for the third quarter to December. Earnings per share is expected to come in at 3.44 hkd. It said it sees 'slight improvement' in Lenovo's earnings before interest and tax and EBITDA margins.

New listing Wuyi Pharmaceutical ended the morning at 1.94 hkd, up 7.8 pct from the IPO rice of 1.80. The stock opened at 1.97 hkd and hit a high of 2.07 hkd.

Oil counters were mixed, with PetroChina up 0.01 hkd or 0.10 pct at 9.58, Sinopec down 0.11 hkd or 1.68 pct at 6.42 and CNOOC down 0.01 hkd or 0.15 pct at 6.63.

Elsewhere, Chalco was up 0.55 hkd or 7.90 pct at 7.51 after announcing that it raised alumina spot prices by 50 pct to 3,600 yuan per ton.

(1 usd = 7.8 hkd)

leonora.walet@xfn.com

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