Hong Kong shares close morning up on tech rebound; off highs on U.S. concerns
HONG KONG (AFX-ASIA) - Share prices closed the morning higher on a technical rebound, but off highs as concerns over further volatility on Wall Street and the U.S. economic slowdown eroded earlier gains, dealers said. H shares provided some support as institutional investors were confident that China will continue to outpace global economic growth, they said. However, they said while some stocks such as HSBC supported the overall market, Pacific Century CyberWorks weighed it down as investors worried about the company's profit and business outlook. The Hang Seng Index closed the session up 19.93 points at 12,697.82, off an early high of 12,802.52 and an early low of 12,685.93, on turnover of 3.16 bln hkd. The Hang Seng April contract last traded at 12,720 points. The Hang Seng China Enterprises index was up 9.93 at 411.29 and the CAC index up 5.26 points at 1,036.62. TraHK was up 0.05 at 12.90 hkd on volume of 1.02 mln units. The GEM index was down 0.95 points at 255.56 on turnover of 118.87 mln hkd. Johnny Mak, associate director with China Everbright Securities, said it is not easy for the Hang Seng Index to make a breakthrough since worries about U.S. equity market movements and the global economic slowdown can hardly be ignored. "The concerns were still there, capping the upside from the technical rebound. Many investors stayed on the sidelines, which kept turnovers thin," Mak said. Dealers said HSBC served as an anchor for the overall market. "But, I am afraid that deteriorating corporate earnings will undermine the profitability of the banking sector. Investors should be careful," Mak said. HSBC rose 1.25 hkd to 92.00, while Hang Seng Bank fell 0.25 to 90.00. Bank of East Asia was unchanged at 17.55, while Dao Heng Bank rose 0.10 to 36.20. Dealers said PCCW continued to underperform the broader market after the company reported worse-than-expected 2000 results. PCCW fell 0.20 hkd or 6.15 pct to 3.05 on volume of 48.71 mln shares. Hutchison Whampoa fell 0.25 to 80.25 and China Mobile lost 0.10 to 34.30. Among property stocks, Cheung Kong rose 0.50 to 80.50, Sun Hung Kai Properties gained 0.50 to 74.00 and New World Development added 0.05 to 10.00, while Henderson Land fell 0.80 to 38.70. CLP rose 0.20 to 41.00 after the company announced it will acquire a 49 pct stake in Shenmu II Power Station in Shaanxi Province for 18.35 mln usd. Dealers said H shares extended their gains on expectations of strong economic growth in China, and may go higher as their valuations remain attractive despite recent rises. China Shipping Development rose 0.10 hkd to 1.18 and Zhenhai Refining gained 0.04 to 1.18. Huaneng Power added 0.275 to 4.15 and Harbin Power rose 0.02 to 0.56. Jiangsu Expressway gained 0.05 to 1.45 and Anhui Expressway rose 0.04 to 0.98. However, Jilin Chemical fell 0.07 hkd or 11.86 pct to 0.07 hkd on volume of 73.35 mln shares after the company posted a net loss of 836 mln yuan after a huge writeoff for its outdated production facilities. On the GEM board, tom.com fell 0.02 to 1.97 and Sunevision lost 0.025 to 2.075.
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