Fund inflows drive shares to new high
Updated: 2007-09-28 06:54
(HK Edition)
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Hong Kong stocks rallied 2.4 percent yesterday, as ample fund inflows fuelled record volumes and China Mobile powered the telecom sector amid further speculation of a sector revamp despite industry statements to the contrary.
"The party is still going on," said Howard Gorges, vice-chairman at South China Brokerage.
"People are reckoning the US will avoid a recession and the world economy will remain resilient. The feeling that the Fed will need to ease further ... is also behind all this."
The benchmark Hang Seng Index closed up 634.86 points at 27,065.15, having earlier breezed past the 27,000 mark for the first time to set its sixth-straight life high.
The China Enterprises index of H shares, or Hong Kong-listed shares in mainland companies, also set a new peak, gaining 381.65 points to 16,644.49, having earlier set a record at 16,740.03.
Mainboard turnover was a massive HK$147.1 billion (US$18.9 billion) compared to Tuesday's HK$129.2 billion.
Wireless provider China Mobile, the biggest boost to the blue chips, shot up 6.5 percent to HK$129, having earlier set a record high. Its smaller rival, China Unicom, shot up 9.3 percent to HK$15.92. China Telecom bolted 13.2 percent to HK$5.82, having earlier set a fresh record, and China Netccom notched up 6.1 percent to HK$20.65.
China Mobile said in a statement there was no negotiation under way relating to acquisitions while a China Netcom independent director said 3G licensing could be delayed until after the Olympics, JP Morgan said in a research alert, citing E-finet News.
China Life, the day's top-traded stock, finished up 3.7 percent at HK$43.20. Rival Ping An Insurance (Group) Co of China Ltd surged 7.1 percent to HK$108.7. Non-life insurer PICC Property and Casualty Ltd raced up 4.7 percent to HK$15.08.
China Resources Power Holdings Co Ltd lurched up 8.5 percent to HK$21.75. Goldman Sachs said in a research report dated September 27 that it was adding the stock to its conviction buy list. The bank, which was also raising the power producer's target price by 23 percent to HK$29, said the company's strong earnings growth potential was deeply undervalued.
An all-time high in the Baltic Dry Index, an indicator for commodity-freight rates, pushed up shipping stocks.
China COSCO Shipping surged 9 percent to HK$23.65 and Pacific Basin jumped 4.7 percent to HK$14.84.
Reuters
(HK Edition 09/28/2007 page6)