Hong Kong shares close lower led by China Mobile; FOMC rate cut factored in

HONG KONG (AFX-ASIA) - Share prices closed lower led by China Mobile, which fell sharply on fears of a price war in the mainland telecom market, while overall sentiment remained nervous ahead of tonight's FOMC meeting, dealers said.	    They said a earlier technical rebound in HSBC ran out of momentum, while selling pressure in properties intensified in the afternoon, as investors priced in a 50-75 basis point interest rate cut by the FOMC.	    The Hang Seng index closed down 223.83 points at 13,223.86, off a low of 13,200.55 and a high of 13,565.97, on turnover of 5.79 bln hkd.	    The Hang Seng March contract last traded at 13,250 points.	    The Hang Seng China Enterprises index was down 8.16 points at 388.69, while the CAC index was down 12.79 points at 1,051.75.	    TraHK was down 0.25 hkd at 13.40 on volume of 6.98 mln units.	    The GEM index was down 4.51 points at 267.08 on turnover of 78.95 mln hkd.	    MTR Corp dropped 0.15 to 12.90 on trade of 5.81 mln shares.	    Y.K. Chan, an analyst with CEF Brokerage, said investors preferred to stay on the sidelines ahead of the FOMC meeting.	    "Selling pressure was stronger in the afternoon... the U.S. stock markets were lower last week, but Hong Kong was relatively stable yesterday, so the Hang Seng Index was catching up with the declines today," he said.	    China Mobile closed down 1.30 at 36.80 on worries over a possible price war in the mainland telecom market after the company's parent announced plans to offer monthly cellphone packages for as little as 30 yuan.	    China Mobile said it has no plans to follow suit but the news still drove the stock and other telecom shares down sharply, dealers said.	    China Unicom fell 0.30 to 9.60 and Hutchison was down 1.75 at 83.50. PCCW was 0.10 lower at 3.80. SmarTone bucked the trend, rising 0.05 to 10.35.	    Properties underperformed, as investors took profit on yesterday's gains, with a substantial U.S. interest rate cut fully discounted by the market, Chan of CEF Brokerage said.	    The property sub-index was down 396.44 points at 17,925.91.	    Cheung Kong finished down 2.50 at 87.00, New World Development dropped 0.10 to 10.70, and Sun Hung Kai Properties was down 1.25 at 78.00.	    Hysan was down 0.70 at 12.25 and Sino Land shed 0.20 to 3.80, ahead of the release of results after the market close.	    Hysan is expected to report a net profit of 892 mln hkd for 2000, down 26 pct, while Sino Land is forecast to post net profit of 353-369 mln hkd for the six months to December, compared with 708.19 mln hkd a year earlier.	    Within the financial sector, HSBC closed unchanged at 92.75 after technical gains in morning trade. Bank of East Asia was down 0.10 at 18.10, Hang Seng Bank fell 2.00 to 89.75 and Dao Heng Bank gained 0.10 to 37.80.	     On the GEM board, tom.com was down 0.05 at 2.05 after results, hongkong.com dropped 0.005 to 0.36 and Sunevision was steady at 2.325.	    Among red chips and H-shares, Beijing Datang was down 0.125 at 2.35, Legend  was unchanged at 5.25, China Merchants was down 0.15 at 5.45, and Tsingtao  Brewery was down 0.05 at 1.93.	    Chu Kong Shipping was 0.02 lower at 0.70, after its plan to acquire interests in 10 ports from its parent.	    Tianjin Capital was down 0.02 at 0.90, following news that it plans  to invest 503 mln yuan in infrastructure and environmental projects in China.

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