Hong Kong shares close morning slightly lower ahead of U.S. jobs data

HONG KONG (AFX-ASIA) - Share prices closed the morning slightly lower, with most investors sidelined ahead of the release of U.S. February employment data, which may give an indication of how much the Federal Reserve may cut interest rates at the next FOMC meeting, dealers said. They said trading volume was thin, with some bargain-hunting focused on the banking sector offsetting the impact of NASDAQ's overnight losses and Intel's profit warning. Red chips and H-shares extended their losses on profit-taking after recent gains triggered by China's decision allowing domestic investors to trade B shares, dealers said. The Hang Seng index closed the morning down 27.77 points at 14,181.18, off a high of 14,288.58 and a low of 14,148.73, on turnover of 2.74 bln hkd. The Hang Seng March contract last traded at14,107 points. The Hang Seng China Enterprises index was down 3.76 points at 399.28, and the CAC index was down 23.52 points at 1,141.59. TraHK was unchanged at 14.30 hkd on volume of 1.69 mln units. The GEM index was down 2.29 points at 285.07 on turnover of 115.16 mln hkd. MTR Corp was down 0.05 at 13.90 hkd. Eric Yuen, research manager with Dao Heng Securities, said the market was directionless, moving within a narrow range, after the year to March 2002 government budget announced Wednesday gave no surprises. "With little news to prompt investors to sell or buy stocks, they just retreated from the trading floor, waiting for fresh leads" such as tonight's release of the U.S. jobs data, Yuen said. Yuen said some bargain-hunting emerged to prop up the bank sector, helping cushion the impact of NASDAQ's declines and Intel's profit warning. HSBC rose 0.50 to 104.00 and Hang Seng Bank gained 0.50 to 93.25. Bank of East Asia added 0.25 to 19.20 and Dao Heng Bank rose 0.40 to 39.90. Using the NASDAQ fall as an excuse, investors took profits in Legend after the company confirmed it will spin off and list unit Digital China, dealers said. Legend lost 0.35 or 5.98 pct to 5.50 on volume of 25.14 mln shares, while ASM Pacific fell 0.05 to 15.00. Among telecom stocks, China Mobile rose 0.10 to 37.50 and Hutchison Whampoa was unchanged at 88.75. Pacific Century CyberWorks fell 0.05 to 4.20 after the company said executive director George Chan has resigned. Yuen said buying may resume in the property sector ahead of results announcement by major developers starting next week, but he added he does not expect any surprisingly good results. Cheung Kong fell 0.25 to 92.50 after the company launched the first four units at its University Court development at an average price of 4,226 hkd per square foot and announced that it will provide a rebate of up to 1.5 pct of the property value for prospective buyers. Sun Hung Kai Properties shed 0.75 to 84.00, Henderson Land lost 0.40 to 45.70, and New World Development was down 0.15 at 13.30. Swire Pacific fell 1.50 to 52.00 ahead of its2000 results. Dealers said China plays trended lower on profit taking. CNPC fell 0.02 to 0.54, COSCO International lost 0.03 to 0.87 and Shenyin Wanguo shed 0.02 to 0.80. On the GEM board, tom.com fell 0.05 to 2.225 and Sunevision lost 0.05 to 2.60. iLink last traded at 1.50 hkd, compared with its IPO price of 1.28.

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