Jardines rides on wave of optimism
THE sudden burst of optimism on Sino-British relations had an immediate effect on Jardine Matheson and Jardine Strategic, whose shares have languished since December under the cloud of a fierce attack by the New China News Agency.
Yesterday Jardine Strategic recorded the biggest rise in the Hang Seng Index, jumping $1.70 or 8.3 per cent to $22.10 on turnover of $28.4 million.
Jardine Matheson added $2.75 or 6.4 per cent to $46 on trade of $89.2 million.
Other shares in the group, which have not been as badly hit by the attack, rose in line with the market.
Mandarin Oriental, also part of the Jardine group, was the worst performing stock in the Hang Seng Index yesterday after a strong run in recent weeks which had been fuelled by predictions of improved tourist traffic for Hongkong and the region.
Since the news of the NCNA's attack first affected the company's share price on December 18, the Hang Seng Index has risen 633.48 points or 11.7 per cent.
At the same time, Jardine Matheson's share price has fallen by five per cent. Jardine Strategic has under-performed the market, rising 7.8 per cent.
Although both shares fell sharply when the NCNA launched its attack - which claimed the Jardine group was ''craving nothing but chaos'' - the outburst has had a longer-term effect.
Although about one third of the initial losses were regained with a strong recovery, investors appeared to have marked down their estimates of long-term potential.
Since January 1, when investors' memories could have been expected to have faded and bargain-hunting to creep in, Jardine Matheson shares have continued to under-perform the index.
Even after yesterday's rise, they have lost ground against the rest of the index this year.
