Hang Seng Index
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Day of window-gazing

THE Hang Seng Index eased down 6.83 points to 6,839.98 yesterday amid lacklustre trading worth $2.35 billion, down $530.8 million.

The absence of news on Sino-British relations and continued caution towards the state of the mainland economy kept retail and institutional investors quiet.

In blue chips, Baring Securities assistant director James Osborn said trading was so lacklustre and boring that ''I had trouble stopping dealers from looking out the windows all day''.

Further rumours about the condition of China's paramount leader Deng Xiaoping also helped to undermine sentiment.

Options trading confirmed the uncertainty, with trading strategies focused around a narrow band of trading between 6,800 and 7,000, said SBCI derivatives dealer James Vinall.

Options traders and technical analysts were in dour mood at the close as the Hongkong Futures Exchange July index contract closed the day at a discount for the first time in recent trading.

''It could signal a test of the 6,800 support. A break below this, which is unlikely without some outside event acting as a catalyst, might not find support again until 6,400,'' said a dealer.

The July contract was down 74 points at 6,828 on a turnover of 5,925 contracts. August was down 82 to 6,820 on a turnover of 980. The total market open interest stands at 25,213, of which 78 per cent remains in July trading.

Bargain hunting in early equity trading yesterday helped the index rise to a high for the day of 6,891.75 just before the lunchtime close.

In the afternoon buying petered out. Selective selling by institutions pushed the index to a low of 6,819.01 before the close.

The Hang Seng sub-indices were flat. The only major mover was utilities, up 0.47 per cent. Property developers and conglomerates slipped.

Cafe de Coral's positive result for the 12 months to March 31 helped perk up sentiment towards second-and third-liners associated with retailing in Hongkong and China.

The fast-food company's share price remained unchanged on the day at $4.95, in the wake of a 35 per cent rise in net profit, ahead of market expectations, to $136.92 million.

Giordano was the third best stock performer of the day, rising 22.5 cents, 5.52 per cent, to $5.20 on a turnover of $4.17 million.

Goldlion also benefited from the result, ending the day up 10 cents at $7.85 on a turnover of $4.43 million.

Fast-food company Fairwood, however, was unchanged at $3.25.

Innovative International, which reported a 73 per cent leap in net profit to more than $100 million, was the ninth best performer of the day, up 10 cents to $2.90.

Mainland-linked back-door listings had a rough day. Shougang International plunged 50 cents, almost 10 per cent, to $4.90.

Other back-door listings on the slide included Public International, down 50 cents, 10 per cent, to $5; Conic Investment, down 42.5 cents, 8.6 per cent, to $4.475; Santai, down 30 cents to $3.40; and Chee Shing, down 16 cents to $1.99.

Ong Holdings lost 90 cents - 11 per cent - to $6.90.

Among blue chips, overseas selling sent Sun Hung Kai Properties down 50 cents to $36 on the largest turnover of the day at $124.54 million.

Conglomerates Hutchison Whampoa and Swire Pacific were down 10 and 25 cents to $19.50 and $36.75, respectively.

Wharf Holdings lost 20 cents to $18.70. Cheung Kong lost 10 cents to $24.80.

Jardine Matheson had a relatively quiet day, remaining unchanged at $54.50, on turnover of $65 million. HSBC Holdings and Hang Seng Bank also remained unchanged at $72.50 and $58, respectively.

New listing CIL Holdings returned investors 15.9 per cent yesterday in a trading debut that left the share at $1.09 and the warrant at 34.5 cents at the close.

Chairman David Woo said the company was negotiating construction projects in Shanghai and Shenzhen. The issue of 72.2 million $1 shares with warrants was 83.8 times subscribed.