Investors cash in gains from property stocks and HSBC but benchmark index stays above 17,000 The Hang Seng Index remained above 17,000 points yesterday, despite a small-scale consolidation driven by profit taking in HSBC and property counters. HSBC, which has been the engine for the recent rally, encountered heavy selling pressure and softened 0.72 per cent to $136.30 at the market opening, before ending the day 0.07 per cent lower at $137.20. Francis Lun Sheung-nim, a general manager at Fulbright Securities, said the counter had risen rapidly in the past few trading days and it was normal to see a small-scale correction especially before a long weekend. The stock market is closed today for a public holiday. The correction in HSBC did not overshadow the optimistic views from large securities houses. Macquarie Securities raised the lender's 12-month target price to $155 from $153. In a report, the Australian investment bank said the strong wholesale banking numbers from HSBC's US operation, coupled with continued economic strength in Hong Kong and a reappraisal of the commercial banking cost base in Britain enabled it to raise the lender's earnings estimates. Macquarie has raised HSBC's earnings per share forecasts by 1 per cent to US$1.58 for next year and 4 per cent to US$1.75 for 2008. The Hang Seng Index ended 0.07 per cent or 13.05 points softer yesterday at 17,013.93. Market turnover shrank to $28.61 billion from $39.25 billion on Wednesday. Also dragging the index down were property counters, which were hit by the latest set of strong economic data showing the pace of activity in the US services sector accelerated more than expected last month and new orders at US factories rose. Dealers said this renewed concerns about rising interest rates especially as the Federal Open Market Committee was scheduled to meet next Wednesday. Henderson Land dipped 2 per cent to $46.45, Cheung Kong lost 0.83 per cent to $88.65 and Sino Land closed 0.71 per cent lower at $13.80. Kenny Tang Sing-hing, an associate director at Tung Tai Securities, believed the market would remain sluggish and saw support at 16,800 before the Federal Reserve meeting. The H-share index rose 52.29 points or 0.73 per cent to finish at 7,153.17, thanks to the strong performance of PetroChina. The mainland's largest oil company jumped 2.21 per cent to $9.25 despite crude oil futures falling in New York to US$71.95 a barrel yesterday. Hong Kong & China Gas inched down 0.53 per cent to $18.75 despite chairman Lee Shau-kee raising his stake in the company to 40 per cent from 39.89 per cent. Beijing Enterprises dropped 4.59 per cent to $16.60 after its controlling shareholder, Beijing Enterprises Investments, sold 50 million shares at $16.53 each to raise $826.5 million. Dao Heng Securities retained its 'sell' recommendation and target price of $13.50 for Beijing Enterprises on the basis it was trading at an unreasonably high forward price-to-earning ratio of 20.8 times. Meanwhile, HSI Services announced that Guangzhou R&F Properties would be included in the H-share index, effective May 12, as the company ranked 21st in terms of average market value for the 12 months to March 21. The mainland developer surged 6 per cent to $46.80 yesterday and has risen 73.33 per cent so far this year.