Profit taking on Sun Hung Kai Properties ahead of its full-year earnings yesterday pushed the stock market sightly lower, but technical buying prevented the Hang Seng Index from finishing below the psychological 15,000-point level. Gains in oil producers, in response to a 3.13 per cent jump in crude oil prices on Wednesday, also helped limit the losses for both the blue-chip and H-share indices. Airlines fell but had a minor impact because of their lower weighting. The Hang Seng Index slipped 0.3 per cent to end 45.6 points lower at 15,041.02, after bouncing off a mid-afternoon intraday low of 14,990.05. The H-share index dropped 15.98 points or 0.31 per cent to 5,062.3. PetroChina attracted a lot of attention as the 3.51 billion shares sold to investors in a placement almost three weeks ago hit the market. 'There had been some concern that the increase in liquidity would put pressure on the share price, but the rise in oil price came to the rescue,' said Louis Wong, a director with Phillip Securities. Indeed, PetroChina's share price rose 0.8 per cent to $6.20, which compared with the placement price of $6. Brokers had earlier said that some investors who bought shares in the placement had already sold the stock short, while even investors who did not want to - or could not - short-sell the stock had been able to sell it from Tuesday for settlement yesterday. Nymex oil futures for October delivery continued to edge higher in electronic trading yesterday, reaching US$65.55 by the end of the Hong Kong session. The contract had jumped to US$65.09 in New York on Wednesday from $63.11 on Tuesday. CNOOC was the best-performing blue chip with a 1.87 per cent gain to $5.45, while China Petroleum & Chemical, which derives the majority of its revenues from downstream refining and chemical businesses, fell 0.75 per cent to $3.325. China Eastern Airlines fell 1.65 per cent to $1.19 and China Southern Airlines dropped 1.15 per cent to $2.15, while Air China was unchanged at $2.375. Cathay Pacific gave up 0.73 per cent to $13.60. SHKP fell 0.85 per cent to $81.55 before reporting a 49.8 per cent jump in annual net profit to $10.37 billion. The result was in line with expectations, but Mr Wong said the improvement in development profit margins to 35 per cent from 20 per cent in the previous year, and management projections it would continue to widen, should give support to the share price in the medium term. But in the short term, further profit taking might be expected after the stock closed at a record high of $82.55 on Monday, he said. Most other developers also fell amid growing expectations that the US Federal Reserve will raise interest rates next Tuesday and that Hong Kong banks will follow suit. Cheung Kong dropped 1.41 per cent to $84.10, Sino Land shed 0.55 per cent to $9 and Henderson Land Development lost 0.26 per cent to $38.60. New World Development bucked the trend with a 0.97 per cent gain to $10.40, making it the second-best blue-chip performer. One broker said that although the near-term interest rate trend was getting clearer, there was still a lot of uncertainty about how much further the Fed was prepared to raise rates. That was keeping property stocks in a narrow range and many investors on the sidelines. 'There is no clear direction in the market and a lot of the activity is due to day-trading,' he said. Yesterday's turnover fell to $15.6 billion from $17.04 billion on Wednesday. Container shipping company and terminal operator China Cosco was among the main losers with a decline of 3.16 per cent to $3.825, despite reporting a 42 per cent rise in its first interim profit since its June listing. Mr Wong said these were historical earnings, while investors were mainly worried that the shipping industry was close to its peak. Also, the fact that the company did not declare a divided was 'certainly a dampener', he said. In its listing document, the company said it would distribute not less than 25 per cent of its profit for the full year.
