Hang Seng Index receives a late lift from rumours ahead of a surprise Lands Department assembly Property stocks strengthened yesterday on expectations the government would reform its lands policy, helping an otherwise uninspired Hang Seng Index to reverse modest losses on the day in the final hour of trading. The blue-chip index climbed 33.58 points, or 0.24 per cent, to finish at 13,979.35, up from an intraday low of 13,890.78 grazed in the morning. July index futures contracts pierced the psychologically significant 14,000-point level, ending 77 points, or 0.55 per cent, higher at 14,065. Late in the trading day, the Lands Department announced an evening press conference. Traders then returned to key property counters, which have been lacklustre in recent days, hoping that the government would introduce significant measures to support an uncertain property market. Henderson Land ended the day at $35.50, up 0.28 per cent, while Cheung Kong rose 0.68 per cent to $73.75. Sun Hung Kai Properties ended flat at $74. After the market close, the government announced reforms to its land applications system. Land auctions will now be triggered when developers agree to bid 80 per cent of the government's valuation target of a property, down from 100 per cent. Kenny Tang Sing-hing, an associate director at Tung Tai Securities, said the decision would have an 'immaterial impact' on property stocks, but was nonetheless 'psychologically positive' as it may aid replenishment of developers' land banks. Mr Tang doubted the policy news would be enough to push the Hang Seng Index past 14,000 points today, noting that 'turnover has been too low recently to support the jump'. Shares totalling $12.91 billion changed hands yesterday, down from the $14.82 billion recorded on Monday. Herbert Lau, head of research at Celestial Securities, said he expected the Hang Seng Index to test 14,500 next month, saying that market liquidity would improve after the Bank of Communications released the $150 billion tied-up in unsuccessful retail subscriptions later this week. Among the 33 Hang Seng Index constituents yesterday, 18 rose, nine dropped and six finished unchanged. Conglomerate Swire Pacific fell 0.36 per cent, or 25 cents, to $69 after touching an eight-year high of $69.25 on Monday. CSFB, which has set a target price of $80 on Swire, said near-term prospects for the company would depend on uncertainties such as the office property market outlook and interest rate movements, but that 'the long-term story around capital deployment, reflecting a more aggressive management style, could be a [positive] share price re-rating agent'. CNOOC, the country's largest offshore oil company, declined 1.18 per cent to close at $4.175 on media reports saying the mainland giant might boost its bid for United States oil firm Unocal Corp to US$20 billion. Banking stocks fell despite the move by several sector heavyweights to increase key lending rates. Bank of East Asia shed 0.21 per cent to $22.80 while Standard Chartered lost 0.34 per cent to $145.50. Both lenders raised mortgage rates by 25 basis points yesterday. BOC Hong Kong, which increased mortgage rates over the weekend, dropped 0.34 per cent to $14.40. Railway operator MTR was the biggest blue-chip gainer yesterday, adding 2.12 per cent to $14.40. Footwear maker Yue Yuen increased 1.7 per cent to close at $23.80. Kingston Lin, an associate director at Prudential Brokerage, said that all four initial public offerings underway this week had met with ambivalent receptions from retail investors. Philip Securities spokesman said that margin financing orders for China Cosco Holdings had come to a little more than $100,000 over the past two days, compared with the billions of dollars in orders placed on the first day of subscription for the Bank of Communications. The other upcoming public share offerings are those of SIM Technology, fire alarm systems maker GST Holdings and office printer maker Jolimark Holdings.