Rally extends to fourth day as sentiment remains strong before share offerings by mainland giants Hong Kong stocks rose for the fourth consecutive trading day yesterday, as China Mobile reached a new high, helping to offset a decline in global banking giant HSBC. The Hang Seng Index closed up 0.16 per cent or 21.97 points at 13,867.07, while turnover swelled to $18.07 billion, from $13.04 billion on Monday. Market sentiment remained positive with the approach of several massive initial public offerings this month, brokers said. 'The market momentum is clearly there, with investor appetites for blue chips still strong,' said Prudential Brokerage associate director Kingston Lin. China Mobile, the world's biggest mobile-phone operator by subscribers, led the market with a jump of 2.52 per cent to finish at $28.45 - its highest close since December 13, 2001. The stock, which has rallied 6.55 per cent in the past four trading days, contributed to a 44.2-point gain in the index. This followed Merrill Lynch reiterating its buy rating on the stock on Monday. Merrill has a 12-month price target of $29 on China Mobile due to a more stable pricing environment this year. Rival China Unicom also benefited from China Mobile's strong share-price performance, closing up 0.8 per cent at $6.25. Linus Yip, a strategist at First Shanghai Securities, said: 'Jitters over interest-rate rises have largely been discounted in the market ... forthcoming [IPOs] should give a boost.' Three mainland giants - China Shenhua Energy, Bank of Communications and Cosco Holdings are poised to raise more than $55.6 billion this month - testing investor appetites as economic growth slows in China. Meanwhile, the performances of key banking stocks were mixed, with HSBC falling 0.4 per cent to $124. HSBC, the biggest blue chip, pulled 17.9 points off the index. Some traders said the decline of HSBC was partly due to early fund switching activities in preparation for the upcoming flotations. Others suggested it was partly due to more than 20 expiring derivative warrants this month, which may continue to exert short-term pressure on HSBC's share price this week. Subsidiary Hang Seng Bank closed 0.47 per cent lower at $104.50, while BOC Hong Kong dropped 0.68 per cent to $14.40. Bank of East Asia, however, added 0.43 per cent to close at $22.90. The aftermath of French voters rejecting a European Union constitution, which caused the euro to weaken against the US dollar, impacted Esprit. The causal-wear retailer, which derived about 80 per cent of its revenue from Europe last year, saw its shares dip 2.19 per cent to $55.75. Garment and textile makers were also under selling pressure in the wake of escalating tension between China, the United States and the European Union over mainland textile exports. Luen Thai slipped 1.6 per cent to $3.075, while Weiqiao Textile slid 0.93 per cent to $10.65 yesterday. 'Such tension will continue to cast uncertainty over the outlook for trading-related stocks in the near future,' Mr Lin said. Property plays had a mixed day. Henderson Land Development continued to ride on the successful presales of its Royal Green residential project in Sheung Shui. The stock closed up 0.28 per cent at $35.50. Cheung Kong declined 0.35 per cent to $71, while ports-to-telecommunications associate Hutchison Whampoa was unchanged at $67.75. Sun Hung Kai Properties was also unchanged, at $74.25. 'Most property stocks are still lagging the market, said Rexcapital Asset Management director Kitty Chan. 'Issues such as the growing number of subsidised housing flats to be released in the market due to the recent rule change and a potential tightening on internal sale practices are still bothering investors.' The H-share index closed 0.39 per cent lighter at 4,593.03 points. PetroChina rose 0.5 per cent to $4.975, while Sinopec fell 1.72 per cent to $2.85. CNOOC added 1.17 per cent to close at $4.30. Traders said the reshuffle of the widely followed Morgan Stanley Capital International (MSCI) indices would spark some buying interest today. The MSCI China Index will see 11 additions, including five privately owned mainland firms. The MSCI Hong Kong Index will gain two more members.