Futures dip on overseas sales

STRONG overseas selling saw Hang Seng Index futures in December slide 55 points, ending a four-day run of gains.

The selling came on the back of heightened interest rate rise concerns in the United States.

Selling began at the opening of trading, the December contract fell to 8,150, rallied to 8,220 before slumping in the afternoon to a low of the day of 8,125.

The contract fell to 8,200, a 34-point premium to the cash market. January futures closed at 8,230, down 50 points.

Overall market turnover was 18,145 contracts, with 16,400 in December and 1,735 in January.

In index options, Jardine Fleming said: 'Investors continued to have interest in December out-of-the-money calls with overseas investors being the sellers and locals being the buyers.' The brokerage said conservative hedgers bought December 7,900 and 8,200 puts.

Overall turnover was 2,266 lots.

Implied volatility in the front month rose marginally to around 28 per cent.

March at the money put and calls were at around 27.5 per cent. W I Carr said over-the-counter volatilities were 28.25 per cent in September 1996 and 28.5 per cent in December 9,600.