Hong Kong shares were lifted 0.63 per cent yesterday, led by a handful of stocks most likely to benefit from the Government's measures to prop up the housing market.
The Hang Seng Index laboured 56.62 points higher to finish at 8,934.56, ending a week dominated by activity in the index futures market.
Over the week, the index shed 6.5 per cent, with speculation that hedge funds and high net-worth investors were using negative reports about the economy to push the market lower.
With open interest in the index futures market at a 10-year high, investors had stayed on the sidelines, fearful of further volatility, brokers said.
Open positions in futures stayed above 88,000 contracts, with 23,706 contracts traded, worth more than turnover in the cash market. Turnover in the cash market was $5.06 billion.
'Futures trading continues to lead the market,' said Tom Leventhorpe, a director at Indosuez WI Carr Securities.
While most of the short selling of the Hang Seng Index has focused on overseas hedge funds, there were rumours yesterday that Li Ka-shing had built up a sizeable short position in index futures and stock options on Cheung Kong and Hutchison Whampoa.
