THE silence on whether there would be talks between London and Beijing led some investors to turn their paper profits into cash yesterday, taking the Hang Seng index down 19.54 points to below 6,500. Among major shares the selling pressure was felt hardest by property stocks, notably Great Eagle Holdings. Hongkong Aircraft Engineering Co's 21 per cent profit rise announced on Tuesday evening sent it in the opposite direction from the rest of the market. It rose 7.3 per cent, $1.70, to $24.90, on trade of $30.8 million. Turnover was $3.95 billion, down $830 million from Tuesday's corrected total but still hectic. The index moved in a tight band of less than 40 points during the day. ''Some investors have been taking short-term profits and we're seeing a change of focus from blue chips to second liners,'' said Chris Malpass, sales director at Peregrine Brokerage. ''The traditional cycle of the market is that the blue chips get the focus as the market rise is in the main phase, and then the interest drifts towards laggards and smaller situations.'' Many smaller shares made dramatic gains on the day. Some of the rises were caused by speculators seeking quick profits from companies being used as shells by mainland corporations: others because the companies had seen their share prices little changed while the Hang Seng index has set records. The All Ordinaries index rose 3.26 points, despite the Hang Seng index's fall. IHD Holdings, Pacpo Holdings, Hongkong Building and Loan and Hongkong Chinese Bank were all suspended pending announcements, while China Strategic resumed trade. The Hang Seng index fell sharply on opening, dropping to 6,471.91 in the first 15 minutes of trade. However, institutions were keen to snap up the shares being sold by short-term traders, and the market soon started to recover. By lunch it had risen to 6,507.16, almost level with the Tuesday close. But after lunch another sell-off pushed prices down again, this time without any recovery. The index slid nearly 20 points in the afternoon's hour of trading. The March index futures contract reflected the less optimistic mood, falling 39 points to 6,476, 12 points below the cash index. Great Eagle fell 7.5 cents, 2.1 per cent, to $3.50. Jardine Matheson, the first to feel any changes in sentiment, fell $1, 1.8 per cent, to $54. Cathay Pacific fell five cents to $9.85 in advance of its results to be announced today. HSBC Holdings had the day's highest trade of $204.2 million and stayed steady at $70. Cheung Kong dropped 30 cents or 1.3 per cent to $23.50. Its Sponikle 1993 warrants saw furious trade of $87.7 million and closed down 2.5 cents at $4.425. Hongkong Telecom bounced back from a week of poor performance, up 10 cents to $9.85. Applied International, whose directors claimed on Tuesday that its exceptional price performance might be inspired by its success selling security products door-to-door in the US, rose a further 36.5 cents or 19.1 per cent to $2.275, on trade of $93.7 million. In the last three days Applied's share price has risen 80.5 per cent. China Strategic resumed trade after a day's suspension, during which it announced a major manufacturing deal in Dalian. Its shares rose 35 cents or five per cent to $7.40. Seapower Holdings said it was considering an approach for its controlling stake in Seabase International, which might result in a general offer. Lung Kee, which had its first day of trade on Friday, continued to rise, closing up 30 cents or 12.1 per cent at $2.775. Shareholders paid $1.21 a share, leaving them with a paper profit of 129 per cent after four days. Another smaller stock attracting interest was Hanny Magnetics, which rose 12.5 cents or 5.8 per cent to $2.275. Hongkong Ferries' 34 per cent profit fall sank its share price by 3.2 per cent or 20 cents to $6.05. Richfield Holdings' shares were the day's worst performer, down 15 cents to $3. Direct and special trades totalled 30.5 million shares, all at $2.80.