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Agatha Ngai

PRICES see-sawed yesterday on fears of another rise in US interest rates before the end of the year.

  The Hang Seng Index rose a meagre 10.97 points to 8,658.83, up 0.13 per cent.

  Trading was lacklustre with only 2.61 billion shares changing hands.

  Compared to the turnover of $4 million to $5 million early this week, the market has apparently calmed down from a bout of selling ahead of the weekend.

  With cautious sentiment, blue chips remained investors' favourite, making up 71.59 per cent of the total turnover.

  Interest in H shares was relatively weak, accounting for 1.75 per cent.

  Brokers said the market was without direction while Wall Street stayed closed on Thursday for the Thanksgiving holiday.

  Investors preferred to stay on the sidelines before their US counterparts made another step.

  'It's hard to predict the direction of stock prices. One should note that the Wall Street ended three points lower on Wednesday, because there was a rebound before the market closed,' said a dealer.

  'However, aggressive selling was still seen in the early trading.

  'Who will dare to guarantee that the market will go up or down when the half-day trading resumes?'   Most analysts wondered about a further interest rates rise before the end of the year, but admitted investors were vulnerable and had adopted a careful approach.

  'In fact, many people in the US have already been noticed the earnings potential of their own enterprises.

  'The fragile stocks are the hardest hit in the recent rates rise,' said Standard Chartered research director Eugene Law.

  'It doesn't make sense if the US authorities raise interest rates again. It will do no good to its economy.'   Yet, without other positive stimuli, investors chose to give a discount to the shares market first.

  Dampened sentiment indicated money had already been switched from the equity market to fixed income securities and bonds.

  Now, brokers are pessimistic about a year-end rally, as investors depend more on sentiment than market fundamentals.

  In addition to the Dow Jones reaction, the release of some inflation-related figures in the US is expected to hit the prices movement next week.

  Yesterday, all but the property sector succeeded in regaining part of their losses.

  Adjusting the 33-point rise in Hong Kong stocks traded in London, the market opened to its day's high at 8,687.01.

  Performance was mixed with 15 stocks closing higher, six unchanged and 12 lower.

  Overall, the commerce and industry counters showed the greatest strength with its sub-index ending 33.48 points, or 0.52 per cent, higher at 6,471.81.

  However, the property sector apparently lacked upwards momentum. It under-performed the Hang Seng Index throughout the day.

  The properties sub-index trimmed a total of 43.87 points to finish at 14,970.23.

  The 18 per cent jump in mortgage loan volume did nothing to boost the counters.

  'Actually, the market reaction to the land auction on Wednesday was encouraging. Still it could not offset the cloud cast over the interest rates rise and the poor trading moral,' said Salomon Brothers analyst George Kee.

  Sun Hung Kei Properties lost 25 cents to $50, down 0.49 per cent.

  It was the fourth most active stock on turnover of $112.45 million.

  Cheung Kong followed and became the fifth most active stock. Shares worth $105.49 million changed hands. The price closed at $33.40, down 10 cents, or 0.29 per cent.

  Hopewell Holdings, which plans to issue $500 million in bonds, was also an active stock in both volume and turnover.

  Its price slid 10 cents to $7.10 with 13.57 million shares worth $95.92 million traded.

  Hang Seng Bank posted a jump of $1 to $57.25 on a turnover of $103.12 million.

    while its parent HSBC Holdings was down 50 cents to $86 on turnover of $304.79 million.

  Hang Seng Bank has recently tried to shake off its conservative image and adopt a more aggressive role in doing business.



Hang Seng in limbo as Wall St takes break