Market Close: Hang Seng dips on profit taking

Hong Kong market dipped on Friday as investors locked in some profits after the benchmark surged by more than 700 points in the previous two trading days, as investors worried that the US may end the quantitative easing plan.

The benchmark Hang Seng Index lost 67.51 points, or 0.29 per cent, to finish at 23,331.09. Turnover stood at HK$77.4 billion.

Property developers bucked the downward trend, while insurers, banks, material sectors, which have led the increase in the market in previous days all retreated on Friday.

China Overseas (0688.HK) added 1.44 per cent to finish at HK$24.7, while Wharf Holdings (0004.HK) gained 1.56 per cent to finish at HK$61.75.

Gome (0493.HK), whose market value was nearly halved last year, rose 6.6 per cent to finish at HK$1.13 on Friday. Investors are hunting for shares that have been underweight last year, such as energy players and consumer discretionary firms.

The headline HSBC Business Activity Index posted 51.7 in December, signalling a modest rate of expansion in service sector activity, according to HSBC on Friday.

However, the rate of growth had slowed from the previous month, with the index posting below November’s index reading of 52.1. Moreover, it was the weakest rate of growth in 16 months.

“The lagged effect of policy easing of 2012 may sustain China’s economic growth momentum in the next couple of quarters… However, slowing potential growth and sluggish global recovery would cap the upside potential,” Citi economist Shuang Ding said in a note on Friday.