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Nick Westra

HSI rises 4.6pc as investors chase telecoms and energy stocks
The stock market rang in 2009 on a hopeful note yesterday as the Hang Seng Index soared to its largest New Year gain in almost four decades after investors  snapped up battered telecommunications and energy stocks.
The Hang Seng Index broke through the 15,000-point barrier for the first time in two weeks, closing 655.33 points or 4.55 per cent higher at 15,042.81.
All but two of the benchmark's 42 blue chips advanced. The rally was the best since the index was launched in November 1969, according to Bloomberg.
Mainland telecommunications stocks keyed the rally as investors tried to capitalise on the State Council's  approval for  third-generation high-speed mobile network licences.
Energy companies also surged after crude oil prices increased to the highest in more than two weeks.
'After the profit taking at the year-end, some of the fund houses  needed to [put cash to work],  helping the market to rebound,' said Linus Yip, a strategist at First Shanghai Securities. 'People are just trying to find a story for some short-term trading for selective buying.'
Other benchmarks around the region trended upwards as investors chased after bargains. South Korea climbed 2.93 per cent, Singapore gained 3.87 per cent and Malaysia rose 2.01 per cent. The markets in Japan, Taiwan and the mainland were all shut for holiday.
On Wall Street, stocks rose yesterday, with the Dow Jones Industrial Average up 138.03 points or 1.57 per cent at midday. The S&P 500 Index gained 14.08 points or 1.56 per cent while the Nasdaq Composite Index added 26.66 points or 1.69 per cent.
The local market was also propped up by bottom-fishing yesterday as some of last year's worst performers enjoyed record paydays.
Johnson Electric Holdings soared 41.22 per cent for its largest gain in 18 years. Citic Pacific, Foxconn International Holdings and Aluminum Corp of China (Chalco) all jumped more than 10 per cent.
'On the first day [of the New Year], there is typically some cash in hand and people just put it to use,' said Auyeung Tat, a fund manager at Apex Capital Management.
China Mobile led the rally, jumping  4.37 per cent to HK$81.20 and adding 89.1 points to the benchmark's advance.
Investors also chased  energy stocks after oil prices rallied. PetroChina and CNOOC increased 6.04 and 4.83 per cent, respectively.
China Petroleum & Chemical Corp gained 5.76 per cent  for its third gain in four trading days.
Hongkong Electric Holdings and CLP Holdings were the only two blue chips to finish lower, chalking up losses of 1.72 per cent and 0.38 per cent, respectively.
Yesterday's sharp gains signalled that market sentiment was improving and it could be enough to sustain the  recent rally, Mr Yip said.
The Hang Seng Index has risen in three of the past four trading days,  adding 858.67 points or 6.05 per cent since Christmas.
But despite yesterday's jump, turnover on the main board barely notched above HK$30 billion.
And trading levels are not expected to rise much further with the Lunar New Year holiday just a few weeks away.
'Next week, turnover will increase a little bit to HK$40 billion, but in the middle of this month, turnover will drop again as investors take a holiday,' said Patrick Shum, a strategist at Karl Thomson Securities.
'The holiday mood will still dominate the market.'
Holiday joy
Since the Christmas Eve break, the Hang Seng Index has gained: 6.05%



Market begins 2009 with biggest New Year rally