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SCMP Reporter

Hong Kong stocks rebounded yesterday after investors were cheered by  Lee Shau-kee's decision to gradually pour HK$10 billion into the market to bolster  his portfolio.
Shrugging off  the United States subprime crisis, buyers  pushed the Hang Seng Index 2.06 per cent higher to 26,541.09 points as they bet Mr Lee, known as 'Asia's Warren Buffett', expected further gains.
The H-share index of mainland-related stocks also ended stronger, rising 0.84 per cent to 15,691.71 points.
Turnover was HK$104.89 billion,  compared with HK$123.77 billion in Thursday's session.
Mainland stocks also rebounded as bargain hunters snapped up banking and property shares on speculation regulators will offer incentives to underpin a market headed for its worst month since 1994.
The  capitalisation of the Shanghai and Shenzhen markets has dwindled by five trillion yuan since the market peaked on October 16.
Despite yesterday's rise, the Hang Seng was still 1,073.34 points lower on the week and has fallen 16.11 per cent from its October 30 record high.
Market watchers said Mr Lee's bullish views might have heartened investors shaken by weeks of negative news about the global economy. Mr Lee said he spent HK$1 billion on the Hong Kong market on Thursday.
Of the five stocks picked by him for investment, only two outperformed the Hang Seng Index yesterday. They were CNOOC and China Merchants Bank, which rose 4.4 per cent and 3.05 per cent, respectively.
The other three, China Life Insurance, Hong Kong Exchanges and Clearing and China Shenhua Energy, gained  1.67 per cent, 1.42 per cent and 0.49 per cent, respectively.
Mr Lee, the chairman of Henderson Land Development, said on Thursday that the market had been oversold and it was time to bargain hunt. He expected the index could reach 30,000 points by the end of next month.
Ben Kwong Man-bun, the chief operating officer at KGI Securities, said yesterday's gains could be seen as a technical rebound. He expected to see the index rise to between 27,000 and 28,000 points by the end of next month.
The Shanghai Composite Index yesterday climbed 0.96 per cent to 5,032.13 points, following a 4.41 per cent fall on Thursday. The Shenzhen Composite Index added 1.5 per cent to 1,272.14 points, after sinking 4.61 per cent on Thursday.
'A one-day rally doesn't necessarily lead to a turnaround,' said Wei Wei, a trader at West China Securities. 'The downward momentum will continue in the near future.'
Speculation that Beijing will slash taxes on stock trades soon contributed to yesterday's gains.
A Securities Times survey showed that 40 per cent of fund managers believed the Shanghai index would surge to 8,000 next year, buoyed by the Olympics.
'It all hinges on economic growth and corporate profitability,' said Qi Fupeng, a strategist at China Jianyin Investment Securities. 'I don't believe the economy will maintain the fast growth next year.'



Lee's bet prompts rebound in HK stocks