Analysts expect the Hang Seng Index to test 15,800 level as the correction is almost over The Hang Seng Index bounced back yesterday following the sharp recovery in Tokyo stocks that reflected on most Asian markets. After a 926-point slide since Tuesday, Japan's Nikkei-225 Index rebounded from the Livedoor scandal, rising 2.31 per cent. The positive sentiment stretched to other Asian markets, pushing the Hang Seng Index up 189.21 points, or 1.22 per cent, to finish at 15,670.42. The rally took the index back to the technically crucial 10-day moving average of 15,500. Shares worth $32 billion changed hands, down slightly from $33 billion on Wednesday. Rumours of a merger between the mainland A-share and B-share markets continued to fuel the H-share index, which rallied 161.22 points or 2.71 per cent to close at 6,103.43, the highest since September 15, 1997. Kenny Tang, associate director at Tung Tai Securities, said the correction was almost over and the next target level would be 15,800. After three days of declines, investors started chasing index heavyweights again, with China Mobile jumping 2.02 per cent to $37.95. Hutchison Whampoa surged 1.66 per cent to $79.40 on news that its Italian 3G spin-off plan is about to be approved by regulators in Rome. Macquarie Securities said in a report that the listing of 3 Italia was a catalyst to revalue Hutchison. The Australian investment bank has set a 12-month price target of $100.18 for the company. Cheung Kong closed 1.15 per cent firmer at $83.45 after the company beat four other developers to win the contract for the second phase of the MTR Corp's huge residential development in Tseung Kwan O on Wednesday. Yue Yuen Industrial, the only blue chip to lose ground yesterday, eased 0.22 per cent to $22.50 as a potential European Union anti-dumping tariff on Chinese footwear is expected to put pressure on the shoemaker's margin. H-share trading was very active once again with turnover of $7.82 billion, accounting for 24.4 per cent of the market total. Catching the spotlight were mainland banking, insurance and oil stocks. Bank of Communications surged 4.82 per cent to a high of $4.35. China Construction Bank and Ping An Insurance climbed to new highs of $3.025 and $16.85, respectively. Sinopec leapt 4.17 per cent to $4.375, benefiting from news that China may adopt piecemeal reform of refined product prices. Meanwhile, sources said that Modern Beauty, which won approval from the listing committee yesterday, intended to distribute at least 60 per cent of its profit as dividend for this and the next financial years. The facial and spa service provider recorded a profit of $34 million on turnover of $150 million for the four months to July last year. For the year to March last year, it posted a $110 million profit on turnover of $380 million. The company is set to open its institutional book on Monday, followed by a public offering next Friday and a trading debut on February 9. It aims to raise $194 million by offering 180 million new shares at 88 cents to $1.08 each. Xinjiang Tianye, which is looking at a $200 million to $300 million float, also passed the listing hearing yesterday. The company plans to list on the Growth Enterprise Market in late February. Sun Hung Kai International is the sponsor for both offers.
