Hong Kong stocks marked time yesterday with investors figuring this year's expected slim rise in earnings was already well factored in. The Hang Seng Index fell 7.81 points to close at 11,222.83 on a thin turnover of HK$5.78 billion. Blaming the lacklustre performance on the United States Federal Reserve meeting was 'just an excuse', OSK Asia Securities research manager Alex Wong said. 'This is a very boring market, turnover is getting less and less,' Mr Wong said. BNP Paribas Peregrine regional strategist Raymond Foo said the lack of interest could be seen by comparing the market to the South Korean exchange. The market capitalisation of Hong Kong was US$476 billion while Korea's was less than half that at $212 billion. Yet turnover in Korea was regularly hitting $4 billion against Hong Kong's less than $1 billion, he said. 'Essentially, if you look at this year, what you have to buy is cyclicals to play the global recovery. Hong Kong, unfortunately, doesn't have a lot of cyclicals,' he said. Tung Tai Securities associate director Kenny Tang Sing-hing said worse than expected blue-chip results left most big firms trading on 16 to 18 times historic earnings. Projected 5 per cent earnings growth this year left little room for an upside. 'If the Hang Seng Index were to go up, then the [price-earnings] would go up to 20 times. In the present economic situation, that can't be justified,' Mr Tang said. China Mobile fell 1.81 per cent to HK$24.40 on dashed hopes that the company would pay a dividend, Mr Tang said. The market is worrying about a new price war after rival China Unicom began aggressively chasing customers through handset subsidies. Dividend hopes are alive for Pacific Century CyberWorks, which reports its full-year results today. The stock rose 2.46 per cent to $2.075. 'If CyberWorks can pay a dividend, then it can attract more fund managers,' Mr Tang said, pointing out that with lower restructuring costs and provisions, the market was anticipating earnings of 10 cents a share for last year and 20 cents for this year. Malaysian brokerage OSK Asia soared 39.73 per cent to 51 cents as it was bid up close to the 54 cents per share general offer from Kingly Profits, an affiliate of Taiwan's Ting Kong Group. OSK was to be merged with unlisted Hong Kong company Ting Kong RexCapital, giving greater access to capital markets, Mr Tang said. Jonogden@scmp.com
