Hong Kong stocks finished the day higher, with investors favouring property counters. HSBC continued to show its muscle, adding $1 to $142. Most of the action, however, was concentrated on smaller stocks, where investors see greater trading opportunities. Bulls and bears were both active in the market before the Hang Seng Index closed at 11,636.13, up 32.6 points, or 0.28 per cent. Traders said lacklustre turnover of $4.53 billion, compared with a revised $5.42 billion on Wednesday, indicated poor investor sentiment. Property stocks shrugged off news reports that residential mortgage lending slumped in August. HG Asia property analyst Franklin Lam said the mortgage lending figures did not reflect market conditions. He believes the property market is taking a breather after a very strong first half. Sun Hung Kai Properties added 50 cents to $79.75, after reports that the government had approved the firm's plan to build a 46-storey commercial building in Hung-hom. The stock also gained as Bankers Trust yesterday added a further 15 million warrants to their 25.5 million American-style warrants set on Sun Hung Kai in April. The new warrants were priced at $2.35 each, compared with yesterday's closing of $2.60 for the existing warrants. First Pacific continues to feel the sting of profit-taking on the rally it staged after being elevated into the blue-chip Hang Seng Index. The stock lost 1.2 per cent to end the day at $11.65. James Osborn, sales director at ING Baring, said: '[First Pacific] is a victim of its own overperformance in the short term.' Red-chips, or stocks of Hong Kong-listed firms with heavy exposure to China, continued to perform well. This was partly due to 80 million warrants issued on a basket of China-related stocks earlier in the week by BZW. Cosco Pacific gained 2.3 per cent to $6.65 as Union Bank of Switzerland set 375 million call warrants on the stocks yesterday at a strike price of $5.99 and a gearing of 4.7. China resources closed up 1.3 per cent at $7.40, while Guangzhou Investment added 1 per cent to $2.375. Two of the week's big gainers lost ground yesterday. Shun Tak fell almost 2 per cent to $5, while Hong Kong Ferry lost 2.6 per cent to $13.85. Mr Osborn remained bullish on the market's medium-term outlook. He said: 'In index terms we are on the verge of a breakout. We will go through 12,000 with no problem, but in terms of timing we will have to be patient.'