Investors chasing blue chips for strong corporate earnings results drive turnover to $22.43 billion Hong Kong's stock market rallied for a second consecutive day to post an eight-week high yesterday, buoyed by Thursday's gains on Wall Street and hopes of strong local corporate earnings results. The Hang Seng Index gained 96.18 points, or 0.68 per cent, to close at 14,157.09 after touching an intraday high of 14,207.53. Brokers said trading was heavy as retail investors poured in to buy small and mid-cap stocks. Turnover reached $22.43 billion, $5.38 billion more than the previous trading day and the highest since January 7. Trading linked to index futures on the expiry of February contracts contributed to the high turnover. Hang Seng Index February contracts climbed 145 points to close at 14,172, while March contracts rose 114 points to 14,060. A total of 38,819 index futures contracts were traded. The total number of open contracts stood at 128,789. The blue-chip index had gained 199.15 points over the past two days, but ended the week just 62 points higher. Shoemaker Yue Yuen Industrial was the top gainer, rising 4.75 per cent. Three China-related index stocks - CNOOC, China Mobile and China Unicom - also posted strong gains. 'The market is gaining momentum and getting more bullish. We're seeing buying interest return,' said Trevor Cheung Kwok-yuen, the head of research at DBS Vickers Securities. 'People are still concerned about interest-rate rises and the outlook for the US dollar, but the underlying tone is that Hong Kong fundamentals are still very strong,' Mr Cheung said. 'Many believe the upcoming corporate earnings results are going to surprise the market on the upside.' DBS is expecting the Hang Seng Index to break through the 14,300-point level and surge to 15,000 next month. Steven Leung Wai-yuen, a director at UOB Kay Hian, echoed DBS's optimism, saying expected strong earnings over the next few weeks would trigger a sustained rally. 'This market is going to move very fast. Once the market breaks through the resistance level, it can easily go up another 500 to 1,000 points,' Mr Leung said. He said HSBC and Hang Seng Bank's full-year earnings results, to be released on Monday, along with positive news from next week's National People's Congress, could be catalysts for a spring rally. 'The market is expecting news from the upcoming NPC meeting. It could be on the yuan, [the qualified domestic institutional investor scheme] or perhaps a softer tone on economic tightening,' Mr Leung said. H shares rallied 90.42 points to 5,024.92, the first time since April last year the index has broken the 5,000-point level. Investors continued to chase retail stocks after Esprit posted an astounding 76 per cent rise in half-year net profit on Wednesday. Dickson Concepts rose $1.15, or 8.85 per cent, to $14.15, while Lifestyle International gained 75 cents to $13.25 after it said it would open a Sogo department store in Tsim Sha Tsui. Deutsche Bank raised Lifestyle's target price by 4 per cent to $13.60 from $13.10 on expectation the new store would lift the firm's future profit 5 per cent. Oil stocks performed strongly as crude prices rose briefly above US$52 per barrel. CNOOC added 10 cents, or 2.31 per cent, to $4.425. Sinopec gained 4.5 per cent and PetroChina rallied 2.6 per cent. Hopewell rose 2.24 per cent to $20.50 on hopes it would win approval for an $8.4 billion hotel and shopping centre project. The government rejected the proposal after the market closed.