Hedging activities in Hang Seng Index futures undertaken earlier in the week were being reversed yesterday, which led to additional buying of the underlying stocks, market participants said. Trading volume also picked up over the past two days as traders rolled over their positions ahead of the expiry of the August contract on Monday. 'There was a lot of switching into the September contract, but people who covered short positions as the market went up a few days ago were also selling futures and buying back spot,' said Edmond Lee, senior vice-president at SG Securities. This helped push up stocks with heavy weightings in the index. Still, the total open interest in the Hang Seng Index futures increased to 127,886 contracts yesterday from 113,124 on Thursday, indicating a large amount of new positions were being opened. The September contract closed at an eight-point discount to the underlying index, down from a 32-point discount on Thursday. Separately, retail investors were buying large amounts of call warrants on HSBC with strike prices ranging from $112 to $125, showing they were optimistic about further price gains, said Venus Wong at KBC Financial Products. The total number of call warrants on the bank increased by a sharp 200 million over the past two days alone to an aggregate 3.7 billion, she said.