IT was an exciting week for stock punters, with the Hang Seng Index scaling new heights and rumours flying about like mud off a stick.
At such times, investors should remember that share prices can crash as well as rocket. When the market is charging like the proverbial bull, it is the time sharks come out to play.
On Friday, several companies issued public statements through the stock exchange claiming they did not know why activity in their shares was so vigorous.
There were also some pretty strong rumours surrounding Sing Tao Holdings and Hongkong Telecom during the week, which were later disproved.
Sing Tao made a near 12 per cent gain on the belief the controlling Aw family intended to sell its 68 per cent stake in the company to Nanyang Press (Malaysia), a unit of the Hong Leong Group. After a day's trading suspension, Sing Tao issued a denial.
Hongkong Telecom shares benefited from renewed rumours it was on the verge of forging a strategic alliance with a mainland partner by way of a sale of shares by parent Cable & Wireless, a story that fell flat when it was revealed that Citic Pacific was selling its stake to China Everbright Holdings.
This was a case of passing the ball from one hand to the other, analysts said. Both companies are in part owned by China's State Council, and Cable & Wireless, did not relinquish a single share.
