Increasing confidence in the macroeconomic picture and continued strength in conglomerate Hutchison sent the stock market through the 16,500-point level yesterday before paring gains at the close. The Hang Seng Index rose to an intraday high of 16,681.34 but closed just 15.32 points, or 0.09 per cent, firmer at 16,489.59. Turnover was HK$12.27 billion, with Hutchison contributing $1.18 billion. It has been widely speculated that Hutchison will today announce it is teaming up with the Netherlands' KPN Telekom and Japan's NTT DoCoMo by selling a 35 per cent stake in its third-generation mobile joint venture in Europe. Profit-takers caused Hutchison to close marginally up - by 0.93 per cent to $108 - after reaching a day high of $111.50. Analysts also pinned the underlying strength on the present interest-rate environment in combination with positive sentiment towards the property and telecommunications sectors. 'We've seen several pieces of good news,' a Merrill Lynch analyst said. 'People believe that the property market will be stabilising . . . and the second thing is about Hutchison, in particular with their potential co-operation in Europe. People also believe that the US is going to have a soft-landing, so basically the market is getting more comfortable with the macro environment.' On cue, property and select financial counters put in a strong performance yesterday. Chief Executive Tung Chee-hwa's disclosure that the Government had discontinued a controversial annual target to build 85,000 public housing units further supported property counters. Kim Eng Securities research head Stephen Brown said: 'I think Tung's social concerns have been drowned out by the reality that he can't have an economic recovery unless property prices rebound. I think this is generally underpinning the market.' The Merrill analyst said despite the upside, movement was 'quite narrowly based'; a consolidation could be on the way. Rumours Deutsche Telekom was poised to make a bid for Britain's Cable & Wireless failed to drive the share prices of Cable & Wireless HKT and Pacific Century CyberWorks. Brokers said there was some concern about a share overhang surrounding the imminent HKT-CyberWorks merger. HKT shareholders choose between an all-share or cash-and-share mix. One source said market rumours surfaced that 'some of the Cable & Wireless guys will take a cash and share mix, but their feeling is they'll dump their shares'. 'A lot of Cable & Wireless shareholders are mutual funds and trust companies and they can't hold a Hong Kong name,' the trader said. HKT fell 1.2 per cent to $16.35 and CyberWorks slid 3.48 per cent to $13.85. In the broader market, the high-technology sector suffered a downturn following the decline on the Nasdaq Stock Market on Wednesday. The Growth Enterprise Market Index dropped 1.82 per cent to a record low 440.42 points.