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  • Sep 23, 2014
  • Updated: 10:40pm

Hang Seng Index

Established in 1969, the Hang Seng Index is the benchmark stock market index, monitoring changes in 48 constituent blue chip stocks. It is maintained by Hang Seng Indexes Company, a unit of Hang Seng Bank, which is controlled by HSBC Group.

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Hang Seng soars as mainland rally excites investors

Index hits 21-month high as Wall St closeson level not seen for more than five years

PUBLISHED : Thursday, 31 January, 2013, 12:00am
UPDATED : Thursday, 31 January, 2013, 5:20am

The Hang Seng Index climbed to a 21-month high yesterday, with investors taking cues from Wall Street as the Dow Jones approached its highest level in more than five years.

Investors were also excited by the onshore market, which rallied for a third day after a mainland official said Taiwanese institutional investors might have an extra 100 billion yuan (HK$123 billion) added to their quota to invest in the mainland capital market under the qualified foreign institutional investor scheme.

The benchmark Hang Seng Index added 166.89 points, or 0.71 per cent, to finish at 23,822.06, its highest close since April 2011. Yesterday's gains were led by Chinese brokers on the QFII expansion excitement, with Citic Securities adding 6.4 per cent.

Buying appetite, however, was weak overall with market turnover at HK$76.13 billion, falling short of the average of HK$78.4 billion since the beginning of this year.

"Many sectors have been severely overbought at this moment, such as solar and cement sectors," said Ben Kwong Man-bun, head of research at KGI Asia. "If earnings came to disappoint investors, it could trigger a massive sell-down."

French personal care product maker L'Occitane declined 6.5 per cent to finish at HK$23.55 after reporting an 18 per cent revenue growth for the nine months up to the end of last December. Credit Suisse cut its rating to underweight after the earnings report.

The fresh high is being followed by a slew of share placements and rights issues in the market as investors rush to take advantage of the rally. Asset manager IDG Capital Partners is placing 119 million existing shares of Bosideng International at an indicative range of HK$2.16 to HK$2.20, representing up to 5.3 per cent discount to yesterday's close of HK$2.28.

The South China Morning Post reported on Tuesday that Goldman Sachs is selling US$1 billion worth of ICBC shares at HK$5.77. In Hong Kong, ICBC rebounded 0.5 per cent to HK$5.85 yesterday after falling 2.2 per cent on Tuesday.

Simsen International said it offered three rights shares for every existing share to raise HK$181.2 million. The stock tumbled 28.6 per cent to 14 HK cents per share.

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