Market Close: Hang Seng flat at 19-month high
The Hong Kong benchmark swung between losses and gainsthree times on Thursday as some investors started profit taking after the gauge surged to a 19-month high. Yet sentiment is still on the bull side as China’s onshore market posted sharp gains as it opened the new year.
The benchmark Hang Seng Index added 86.62 points, or 0.37 per cent, to finish at 23,398.60. Portfolio rebalancing has pushed up the turnover to HK$89.2 billion, compared with a 30-day average of HK$63.5 billion. Short selling ratio stood at 10.7 per cent.
“Investors these days have been chasing sectors that were underweight last year in a bid to play a China recovery story,” said Castor Pang, head of research at Core Pacific-Yamaichi.
Hong Kong jewellers, which have been one of the big laggards of the benchmark last year, surged on Thursday after a Morgan Stanley report said a re-rating potential could come for the industry on stronger sales growth in 2013.
Chow Sang Sang (0116.HK) surged 12.81 per cent to finish at HK$21.05. The stock gained only 3 per cent in 2012, compared with a 23 per cent rally for the benchmark, as investors worried about its sales momentum amid a Chinese economy slowdown.
Luk Fook (0590.HK), which lost as much as 10 per cent last year, jumped by 8.3 per cent to finish at HK$27.4. “Pessimism is well priced in, and we think the time to invest is when sales growth bottoms out,” Morgan Stanley analysts, led by Edward Lui, wrote in a research note dated January 3.
Insurers, which have heavily invested in A shares, continued to edge up after a sharp rally on the previous day, as the Shanghai Composite Index rose 1.61 per cent to finish at 2,269.13. Ping An (2318.HK) added 2.6 per cent to finish at HK$70, while PICC Group (1339.HK) advanced 1.48 per cent to close at HK$4.11.