Hong Kong's blue-chip benchmark burst past resistance to close above the psychologically important 17,500-point level yesterday as foreign institutions went on a spending spree. The Hang Seng Index bounded up 192.6 points, or 1.1 per cent, to 17,552.26 with turnover soaring to HK$18.94 billion. 'There's been a surge in the amount of buying coming from foreign institutions. This isn't short-term money either. This is money that hasn't been in Hong Kong for the last two years,' China Everbright Securities sales director David Williamson said. Typhoon Eight Research's David Harman said while the market looked overbought, there were no further big resistance levels until a record high at 18,400 points. 'There's rotational buying going on which is helping to extend the rally,' he said. HSBC was again top of the turnover chart on $2.23 billion as it rose 2.93 per cent to $96.50. Yesterday's deadline for shareholders in takeover target Credit Commercial de France to choose between cash and share offers meant HSBC was free to play catch-up with the market without arbitrageurs stepping in. Hutchison jumped 4.07 per cent to $115 as the conglomerate announced an alliance with Japan's NTT DoCoMo and the Netherlands' KPN Telecom to develop third generation mobile services in Europe. Hutchison chief Li Ka-shing once again demonstrated his trading acumen by pulling off a deal which valued the company's British third-generation mobile licence at GBP6 billion (about HK$70.8 billion) just three months after he paid GBP4.38 billion for it. Lehman Brothers analyst Philip Tulk has upgraded Hutchison to 'buy' from 'hold' and is rethinking his bearish stance on the company's 3G prospects. 'Last week was an inflection point,' he said as the first indications appeared of Hutchison's alliance and news that players were collaborating rather than competing for European 3G licences. PetroChina jumped 7.38 per cent to $1.60 as it announced details of a project to pipe gas from Xinjiang to Shanghai. But any earnings were still a long way off, Celestial Asia research head Herbert Lau Chung-kwan said. 'I think the main driver will still be the oil price,' which was heading south, he said. China Southern Airlines was among the H shares which took off yesterday as investors rotated into them, seeking value. The H-share index was up 7.49 per cent while China Southern leapt 14.28 per cent to $2.40. 'That's because it reported very good traffic and load factor figures for the first half and is still a bit cheaper than China Eastern,' Mr Lau said. China Southern was also helped by rumours a foreign airline might take a stake. Pacific Century CyberWorks, which is merging with blue-chip Cable & Wireless HKT, was another strong gainer, up 5.92 per cent to $16.10. China Everbright's Mr Williamson said: 'I think there is another $4 of upside before the merger with [CyberWorks] is completed in August.'