Hong Kong shares outlook: Higher on Wall Street gains/caution remains

HONG KONG (AFX-ASIA) - Share prices are expected to open higher, with sentiment bolstered by Friday's gains on Wall Street, dealers said.	    Investors however will remain cautious in the absence of further fresh leads, with the index likely to trade within a narrow range, they said.	    On Friday, the Hang Seng index closed down 38.49 points at 12,583.36, off a low of 12,396.97 and a high of 12,705.12, on turnover of 10.99 bln hkd. 	    The Hang Seng March contract last traded at 12,625 points.	    The Hang Seng London Reference Index was down 10.52 points at 12,572.84.	    The overnight rate opened at 4.6875 pct, up from 4.5625 pct at Friday's close, while the 3-month HIBOR was at 4.8125 pct, against 4.875 pct. The base rate remains at 6.50 pct.	    Ben Kwong, associate director with KGI Securities, said Wall Street's gains will provide initial support to the Hang Seng Index, though investors will stay  cautious, with the absence of fresh leads preventing follow-through buying.	    "The benchmark index is seen trading higher today but with limited potential upside amid a lack of fresh positive leads in the market," he said.	    He said he expects the Hang Seng Index to trade around 12,600 points today, while the range for the week will be around 12,300-13,000 points.	    Kwong said the rate cut announcement by the Hong Kong Association of Banks Friday will provide only mild support to the index today.	    "Interest rate counters, especially property stocks, are expected to benefit from the rate cut news, though most players have already factored in the news," he said.	    Dealers said PCCW is likely to remain under pressure ahead of its 2000 results Wednesday.	    The company is expected to report a large net loss, though the extent of the loss will depend on how the company amortises the 180 bln hkd in goodwill related to the takeover of C&W HKT last year, they said. 

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