Hurd instinct hits index
A THIN day on the stock market was dominated by second-and third-liners with the Hang Seng Index slipping 37.07 points to 7,168.34 ahead of British Foreign Minister Douglas Hurd's meeting in Beijing tomorrow.
Brokers said there was some optimism at the end of the seventh round of Sino-British talks and expectation of a slight narrowing of the gap following Mr Hurd's meetings, which allowed futures to close at a premium to the cash index.
But the growing number of cash calls, plus new China and Hongkong listings, could depress summer activity.
Yesterday blue chips gave way to smaller companies - many, like Tung Wing Steel and Paragon, now in the hands of mainland giants - with the most active stock being Manhattan Card, which made its market debut on Friday.
Sellers of blue chips hit the market early, dragging the index lower. An intra-day low of 7,129 was hit around 10.15 am.
SBCI Derivatives salesman James Vinall said the spot index fall was averted by a big order for futures.
July futures bounced off an intra-day low of 7,160 to close at 7,242, a 74-point premium to the spot market.
Mr Vinall said: ''The index recovered quite sharply but in the afternoon it was totally and utterly flat. There was no interest either way. The only strength was in New World after being sold off yesterday.'' New World closed up 60 cents at $20.20.
Trade topper Manhattan Card surged 9.52 per cent or 25 cents to $2.875 on the back of $151.67 million worth of deals.
Brokers said the stock attracted much of the American money that is still dripping into the territory.
Behind Manhattan Card, both Tung Wing and Paragon - recent mainland acquisitions - snapped up big slices of the day's action at $107.79 million and $93.44 million, respectively.
Tung Wing rose five cents to $5.55, up 30 cents on the price reached the day after the $1.88 billion rights issue was announced.
Paragon also put on five cents to close at 63 cents, a rise of 8.62 per cent.
Second-and third-liners laid almost exclusive claim to the top 10 slots in volume turnover.
Headed by Paragon and Magnificent, the top 10 also featured Golden Hill, Lolliman Holdings, Dynamic, Rivera and Chee Shing.
Star of the day, Hongkong Worsted Mills, is also the subject of a mainland backdoor listing, with Beijing International Trust and Investment Corp paying $256.5 million for the takeover, or up to $8.75 a share.
Yesterday the counter soared 24.53 per cent to close at $13.20, up $2.60 on the day, on what brokers say was a reaction to the improving value of the yuan.
Among the blue chips, key performers were among property counters, including Hang Lung which put on 10 cents to $11.90.
HSBC Holdings, the day's fourth most active stock, dipped 50 cents to $74.50 on the back of $85.70 million worth of deals.
Hang Seng Bank, the 10th most active stock, was unchanged at $59.
Cheung Kong witnessed a turnover of $80.40 million and shed 20 cents to $27.20 while stablemate Hutchison slid 10 cents to $21.50 as $71.64 million worth of shares changed hands.
Directors did their bit to boost the day's slack turnover by buying up shares in their own companies.
Evergo International Holdings' Joseph Lau Luen-hung yesterday told the exchange he had increased his holding in the company by 40 million shares, or 4.89 per cent of its issued share capital.
At the same time, Chinese Estates Holdings said it had bought back 5.68 million ordinary shares at prices per share ranging between $4.175 and $4.25.
Elec & Eltek International Holdings said it had bought back 3.52 million shares at prices ranging between 77 and 79 cents while World International repurchased 309,000 shares at prices ranging between $9.45 and $9.50.
Leading Spirit, which yesterday fell five cents to $1.29, issued a statement saying it was not aware of any reason for the surge of interest in its stock and was not in takeover talks.