Hong Kong shares close morning higher on Wall St gains, futures-led buying

HONG KONG (AFX-ASIA) - Share prices closed the morning higher in line with the rebound on Wall Street on Friday, with prices further buoyed by short-covering ahead of the expiry of the Hang Seng March futures contract later this week, dealers said.	    They said investors rushed to pick up heavyweight stocks, such as China Mobile, Cheung Kong and HSBC, to effectively push the Hang Seng Index higher in an attempt to gain in futures trading.	    The Hang Seng index closed the morning up 269.69 at 12,853.05 points, off an early low of 12,678.90 and off an early high of 12,855.22, on turnover of 5.06 bln hkd. 	    The Hang Seng March contract last traded at 12,892 points.	    The Hang Seng China Enterprises index was up 10.33 points at 399.28 and the CAC index was up 26.74 points at 1,049.84.	    TraHK was up 0.25 at 13.05 hkd on volume of 5.42 mln units.	    The GEM index was up 0.09 points at 261.28 on turnover of 49.34 mln hkd.	    Kitty Chan, associate director with Lippo Securities, said the rebound on Wall Street triggered buying in the technically oversold Hong Kong market.	    "We have seen investors rushing to take Cheung Kong, China Mobile and HSBC. The move has effectively pushed the index higher ahead of expiry of the March futures contract," Chan said.	    Chan said there is still a chance that the Hong Kong market may go higher in the run-up to the futures expiry.	    "But, we have to watch closely how the U.S. markets move. External factors play a crucial role in the local market ," Chan said.	    Cheung Kong was up 1.00 at 81.50, HSBC added 1.25 to 90.75 and China Mobile rose 1.50 to 34.80.	    However, dealers said concerns about a telecoms price war in China remain in place and are expected to continued to dog China Mobile after the current rebound runs its course.	    Dealers said interest rate cuts by the Hong Kong Association of Banks, effective from today, provided some support for property stocks.	    Sun Hung Kai Properties gained 3.00 to 75.75, New World Development added 0.65 to 10.35 and Henderson Land rose 1.20 to 39.30.	    Sino Land rose 0.15 to 3.475 and Hysan Development gained 0.20 to 11.30.	    Wharf added 1.20 to 20.20 ahead of the company's annual results.	    MTR Corp rose 0.10 to 12.80.	    Li & Fung added 0.45 to 12.55 ahead of annual results.	    While Friday's gains on NASDAQ lent support to local high tech stocks, Pacific Century CyberWorks underperformed the overall market ahead of its annual results due on Wednesday.	    PCCW fell 0.15 to 3.425 on volume of 47.31 mln shares.	    Hutchison Whampoa rose 0.75 to 82.25 and SmarTone gained 0.05 to 10.10.	    China Unicom rose 0.30 to 9.15.	    Legend rose 0.10 to 5.45 and Johnson Electric gained 0.50 to 12.40.	    In the banking sector, Hang Seng Bank added 1.25 to 90.00 and Bank of East Asia rose 0.10 to 18.05, while Dao Heng Bank fell 0.20 to 37.40.	    On the GEM board, tom.com was unchanged at 2.00, while Sunevision was down 0.005 at 2.125.	    China plays also staged a technical rebound in line with the overall market, dealers said, adding expectations that China will continue reforms on its financial markets have also fuelled buying, in particular in H shares.	    Anhui Conch rose 0.11 to 1.05, Jilin Chemical gained 0.06 to 0.58 and Guangdong Kelon added 0.16 to 1.72.	    China Eastern Airlines gained 0.06 to 1.11 and China Southern Airlines added 0.025 to 2.20.	    China Resources gained 0.30 to 10.55 and Shanghai Industrial rose 0.15 to 12.85. 

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