Hong Kong shares close higher in thin trade; rate cut hopes spur buying

HONG KONG (AFX-ASIA) - Share prices closed higher on bargain-hunting, recovering from early losses, amid continued optimism that the U.S. Federal Reserve will cut interest rates next week, dealers said.	    A strong performance by China-related stocks and utilities also supported the benchmark index, though turnover remained generally thin, they said.	    The Hang Seng Index closed up 44.33 points or 0.33 pct at 13,585.14, off a low of 13,408.99 and a high of 13,643.49, on turnover of 8.63 bln hkd.	    The Hang Seng May contract last traded at 13,560 points.	    The Hang Seng China Enterprises Index was up 10.28 points at 487.60, while the CAC Index was 23.30 points higher at 1,270.36.	    The Tracker Fund rose 0.05 hkd to 13.60, and the GEM Index was down 3.29 points at 267.38 on turnover of 156.92 mln hkd.	    Josephine Hui, director with Celestial Asia Securities, said: "The market was quite boring today amid a lack of fresh leads, tracking the directionless performance on Wall Street and NASDAQ overnight."	    After its initial falls, the benchmark index managed to come back into positive territory, supported by some buying interest relating to covered warrants, Hui said.	    "There was some buying interest in covered warrants on some blue chips," she said.	    Expectations of further interest rate cuts next week helped boost sentiment, especially interest rate sensitive financials and properties, they said.	    The HSI financial sub-index rose 25.62 points to 20,672.21.	    The HSI property sub-index was up 13.09 points at 17,244.02.	    Among banks, HSBC was up 0.50 at 97.75 while Bank of East Asia was unchanged at 18.60.	    Among properties, Cheung Kong was up 0.50 at 91.25, Henderson Land was unchanged at 35.40 and Sino Land was also steady at 3.575.	    Dealers said small and medium sized banks got a boost from market speculation that United Overseas Bank of Singapore is targetting an acquisition of HKCB Bank at a per-unit price of 4.0 hkd.	    HKCB Bank rose 0.025 to 3.575 and LCH Bank gained 0.40 to 10.25.	    Wing Hang Bank added 1.35 to 30.40 and Wing Lung Bank rose 0.70 to 38.10.	    Dah Sing Financial rose 3.10 to 44.20, with investors upbeat about its business outlook.	    Dealers said China related stocks continued their momentum, with investors expecting their bottom lines to be further boosted by China's robust economic growth.	    Huaneng Power rose 0.375 to 4.85 and Beijing Datang rose 0.175 to 2.775.	    Zhenhai Refining gained 0.03 to 1.58 and PetroChina rose 0.05 to 1.70.	    China Southern Airlines rose 0.20 to 2.70, while China Eastern Airlines rose 0.07 to 1.25. 	    China Resources rose 0.40 to 12.70 on expectations the company will soon announce a plan to acquire assets from its parent.	    Utilities also staged a technical rebound after their recent falls, they said.	    CLP rose 0.70 to 32.80, HK & China Gas gained 0.05 at 9.45 and Hongkong Electric was 0.65 higher at 27.35.	    Gains by telecom and other high tech stocks were capped after Dell announced plans to cut 3,000-4,000 full-time jobs in the next two quarters.	    China Mobile rose 0.30 to 39.80 and China Unicom rose 0.10 to 12.60.	    Hutchison Whampoa rose 0.50 to 87.25 and Pacific Century CyberWorks rose 0.025 to 2.85.	    SmarTone fell 0.35 to 9.60 and Legend fell 0.10 to 6.25.	    On the GEM board, tom.com fell 0.075 to 2.05, while Sunevision fell 0.02 to 1.90.	    First Pacific rose 0.05 to 1.72 on a technical rebound.  

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