Opinion | Second-liners take the spotlight amid decline in director activity

After surging for two consecutive weeks, directors' buying of shares in their own companies fell in the second week of the month, with 43 companies reporting 149 purchases worth HK$175 million, based on filings made to the stock exchange.

The activity was sharply down from the previous week's 53 companies that reported 282 purchases worth HK$290 million. This coincided with a 4.18 per cent rebound in the Hang Seng Index last week to 20,629.78 points.

Surprisingly, the surge in the market did not result in profit taking, as insider sales fell for a second week with eight firms reporting 20 disposals worth HK$7.4 million, down from nine companies that reported 35 trades worth HK$146.9 million.

Buy-back activity was also down, with 20 companies disclosing 70 share repurchases worth HK$45.9 million, against 23 companies that reported 99 trades worth HK$96.2 million the week before.

Non-executive director Shi Yuzhu of China Minsheng Banking was one of the top buyers, with 5 million shares bought on September 6 at HK$5.76 each. The trade raised his holdings to 349.48 million shares, or 6.05 per cent of the issued capital. The acquisition was made after the stock plunged 22 per cent from HK$7.38 on August 9.

Shi previously acquired 42.7 million shares in September last year at an average of HK$4.77 each. Interestingly, those trades were made after the counter plunged from HK$6.66 in August and from HK$7.63 in April last year. The stock rebounded sharply after those acquisitions to HK$6.82 in October.