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Uncertainty dogs futures


HANG Seng Index April futures fell 45 points to 8,645 in thin trading yesterday as continued uncertainty in foreign exchange markets hindered major activity from big overseas institutions.

The May contract fell by 35 points to 8,655.

Overall market activity saw 120,850 contracts change hands and 1,471 lots in index options trade.

Overseas investors tended to be sellers after the strong accumulation ahead of the Easter break.

Jardine Fleming (JF) said: 'Options traders had differing market views, with attention focusing on near-the-money calls.' Implied volatility in the front month lifted for the first time in about a week to 24.25 per cent.

From March 20 to the end of last week, implied volatility fell from 32 per cent to a six-month low of 22.5 per cent.

JF said: 'Those expecting the market to peak near 8,800 sold April and May 8,800 calls.' In stock futures, volume remained thin with 110 contracts in HSBC and 13 in Hongkong Telecom traded.

April HSBC closed up 60 cents at $91.65 against a cash close of $91.50, up 50 cents.

April Hongkong Telecom was up five cents to $15.30 against the cash, closing at $15.35, up 15 cents on the day.