HSI climbs 2.35pc as investors go for oil and gold shares After a two-day slump, Hong Kong stocks rebounded 2.35 per cent yesterday, driven by the strong performance of oil and gold stocks. The benchmark Hang Seng Index, which made its first gain this year, leaped 632.41 points to close at 27,519.69. The H-share index rose 2.84 per cent to end 438.74 points higher at 15,903.4. 'Many investors have been lured to invest their money into resource and gold stocks due to the near-record high crude and gold prices,' said Felix Man Kam-fai, a director of Hantec Futures. PetroChina, the country's top oil and gas producer, was the most active stock of the day, jumping 7.42 per cent to HK$14.18 as world crude prices hovered just below a record US$100 per barrel. CNOOC and Sinopec Corp also gained. CNOOC, the mainland's biggest offshore oil and gas producer, advanced 5.64 per cent to HK$13.86. Sinopec, Asia's largest oil refiner, closed up 5.05 per cent at HK$11.66. Metals stocks also gained across the board as precious metal prices soared. Zijin Mining Group rose to its highest level since November last year after investment bank Goldman Sachs raised the stock's target price by 11 per cent to HK$15 on record bullion prices. The Fujian-based gold producer jumped 7.18 per cent to close at HK$13.44. Its smaller rivals also gained, with Henan-based Lingbao Gold surging 20.08 per cent to HK$5.98 while Shandong-based Zhaojin Mining Industry leapt 8.53 per cent to HK$37.55. Jiangxi Copper, which also produces platinum, silver and gold, rose 9.72 per cent to HK$20.10. Goldman said potential further interest-rate cuts by the US Federal Reserve could keep the US dollar in weak territory, which is a key positive for gold. The investment bank valued Zijin and Zhaojin's stocks on the expectation that gold will average US$800 an ounce this year. Mr Man said he was not surprised to see a rebound yesterday because the blue-chip index had 'tested its bottom in the previous two days'. His view was shared by Yiu Chin, a director of financial analysis at Altruist Financial Group. Mr Yiu said that because Hong Kong's economy was becoming increasingly integrated into the mainland's, the recent strong performance of the A-share market also supported the rebound. The Shanghai Composite Index rose 0.78 per cent to 5,361.574 points, raising its gains to 1.9 per cent for the first three days of the year. The Shenzhen Composite Index ended the day up 0.94 per cent at 1,508.636 points. 'As more fund managers come back from the holidays there should be more funds flowing into the market,' said Nelson Chan Kai-fung, a general manager at Bright Smart Securities. Describing the overall market performance as 'positive' this year, Mr Chan said a possible rate cut by the Fed later this month would boost the market, especially property plays. On the expectations of a new rate cut, property stocks continued to rally yesterday. Henderson Land Development edged up 3.26 per cent to HK$74.50 and Sung Hung Kai Properties rose 2.91 per cent to HK$166.10. Mr Chan said that with fresh capital from the rest of Asia, including the mainland, flooding into Hong Kong, the Hang Seng Index could soar to 38,000 in the third quarter, before retreating to 35,000 in the fourth.