Hong Kong shares -- 2 (still uncertain about market stability: analyst)

At 11:10 am, the Hang Seng Index was down 2.57 at 13,963.86, off an early high of 14,200.90, on turnover of 4.14 bln hkd, while the Hang Seng March contract last traded at 13,955 points. Chu Siu Wah, head of research with G.K. Goh, said it is still too early to say if the overall market will stabilise after the recent heavy sell-off. Chu said the most important factor in the Hang Seng Index is the movement of China Mobile, which has a weighting of nearly 20 pct. "Investors are still afraid that its new tariff rates will ignite a price war in the mobile phone market in China. The price competition will squeeze profitability of China Mobile and China Unicom," Chu said. China Mobile rose 0.70 to 36.60 hkd and China Unicom gained 0.35 to 10.45. Chu said he expects property and financial sectors to become relatively stable, helping the overall market. Cheung Kong gained 0.25 to 88.50, Sun Hung Kai Properties rose 0.75 to 80.75, Henderson Land added 0.50 to 44.60 and New World Development rose 0.10 to 12.85. Amoy Properties fell 0.25 to 8.85 and Hang Lung Development lost 0.20 to 7.85 after their lower than expected 2000 results. HSBC fell 1.00 to 102.50 and Hang Seng Bank lost 0.25 to 93.75. "The initial support for the Hang Seng Index will be seen in the 13,800-14,000 point range," Chu said. Legend rose 0.10 to 5.70 after the company said it is considering reorganising its business and assets which may involve a separate listing of a unit. Johnson Electric lost 0.05 to 13.40 after the company said it is moving its production to plants in China and Mexico from Mississippi. On the GEM board, tom.com fell 0.025 to 2.075 after the company said it has signed an agreement to acquire a 50 pct stake in Chinese language weekly Yazhou Zhoukan. Sunevision fell 0.025 to 2.575, while hongkong.com rose 0.005 to 0.39. Among China-related stocks, China Merchants rose 0.15 to 6.05 and Denway Motors gained 0.05 to 1.87. China Resources fell 0.05 to 11.30 and Shanghai Industrial lost 0.20 to 14.20.

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