Policy direction and not the man in the White House more important to local and regional economies The Hong Kong stock market took up where it left off on Monday, having decided the outcome of the US presidential election was likely to have little impact on local or regional economies. The Hang Seng Index rose a further 0.67 per cent, or 88.93 points, to 13,397.67 while the H-share index gained 0.89 per cent, or 40.82 points, to 4,608.55. Trading was heavy with $19.82 billion worth of shares changing hands on the main board. 'As far as the economy is concerned, it does not matter who will win as policies are quite similar between the two camps,' said Andrew Milligan, investment director for Standard Life Investments, with George W. Bush yesterday afternoon looking likely to stay in the White House for a second term. CSFB economists Sailesh Jha and Dong Tao also do not expect any drastic changes in US economic policy after the election. 'Alan Greenspan and other [Federal Reserve] chairman hopefuls are unlikely to change the course of US monetary policy over the next 12-18 months in light of the uncertainty on oil prices, US and China growth momentum, and US inflation momentum heading into 2005,' they wrote in a report. Still, Hong Kong and the regional stock markets reacted positively as Mr Bush edged ahead of Democrat challenger Senator John Kerry. 'With the uncertainties and investors' psychological anxieties [over a potential Kerry victory] removed, the market gave an early celebration to Bush,' said Peter Lai Wing-leung, a sales director at DBS Vickers. The Dow Jones Industrial Average Index futures rose 100 points yesterday afternoon and the US dollar strengthened to $1.2656 against the euro from $1.2744 on Tuesday. Regional stock markets also reacted positively, betting Mr Bush would win. Taiwan's Taiex Index rose 1.79 per cent and Korea's Kospi 200 Index gained 1.74 per cent. The Japanese stock market was closed for a public holiday. 'Earlier fund inflows [into Hong Kong] betting on a yuan revaluation are slowly moving into the local stock market for better returns amid a low interest rate,' Mr Lai said, expecting the Hang Seng Index to head towards the 14,000 level after breaching resistance at 13,400 to 13,500 points. Global fashion chain Esprit Holdings topped the gainers' list among the Hang Seng Index constituent stocks. The stock rose 4.19 per cent to $44.70 after it said sales between July and September rose more than 20 per cent with wholesale orders in Europe seeing double-digit growth. Macau casino-related plays continued their uptrend, with entertainment and leisure firm Melco International Development taking a starring role yesterday after casino magnate Stanley Ho Hung-sun revealed a possible asset injection into Melco. Melco closed at a high of $11.40, up 16.3 per cent. Far East Consortium continued to soar after JP Morgan and Deutsche Bank lifted their price targets for the stock. The counter surged 12.96 per cent to $3.05, extending a gain of 21.3 per cent on Tuesday. The company will sign a memorandum of agreement with The Venetian Group of Nevada in the US to develop a hotel, serviced apartments and retail complex in Macau later this week. Rachel Tong, an analyst with Deutsche Bank, estimated investment in the project to be $1.5 billion to $1.7 billion and expected recurrent income of about $400 million in the first year of operation. 'We believe this will be positive for the company's recurrent income in the long term. Despite the rally [on Tuesday], we expect to see further upside for the stock as both a value and an earnings play,' Ms Tong wrote in a report. She has a 'buy' recommendation with the price target raised from $2.20 to $4.50. PCCW was unchanged at $4.825 despite the company saying its market share for the first nine months shrank to 69 per cent from 72.8 per cent at the beginning of the year. Mainland basic materials shares also rose after recent rebounds in commodities futures prices. Angang New Steel gained 3.1 per cent to $3.325, Aluminum Corp of China rose 2.17 per cent to $4.70 and Jiangxi Copper added 1.18 per cent to $4.275.