Hong Kong stocks reversed most of Friday's losses yesterday amid optimism that healthy residential property sales will underpin developers' earnings.
Finance shares were mixed ahead of HSBC's results announcement, which was made just after the market closed.
Patrick Chia, head of research at China Everbright Securities, said: 'Property counters have underperformed for a while, certainly underperformed the banking sector. The market for residential units has risen quite strongly, this will help earnings.' The Hang Seng Index added 108.56 points to close at 13,507.28. It shed 147.88 points on Friday.
Cheung Kong spearheaded the advance, helping the properties sub-index to add 1.96 per cent to 25,506.54 points.
Brokers said that the territory's second-largest developer was taken higher by the prospect of solid sales this month at its Laguna Verde joint-venture project with China Light & Power in Hunghom.
Martin Tacon, property analyst at Credit Suisse First Boston, said: 'Cheung Kong is initiating interest in Laguna Verde. I think it will sell. It is a good project.' Sentiment also was helped by the prospect of exceptional gains booked this year by Cheung Kong from the January reorganisation of its sister companies, Hutchison Whampoa and Cheung Kong Infrastructure.
Cheung Kong added 3.71 per cent to $76.75, Sung Hung Kai Properties rose 1.39 per cent to $90.75 and Henderson Land Development firmed 2.52 per cent to $71.
