Properties fuel HK shares, Sinoma, China Railway leap

Friday, December 21, 2007

HONG KONG, Dec 21 (Reuters) - Hong Kong stocks rallied broadly on Friday as stabilising global equity markets lifted investor confidence and fund managers sought to dress up their portfolios before the year-end. Local property developers lifted blue chips as the city's ongoing inflation is expected to boost demand for real estate. Mainland infrastructure plays dominated the day's trade as newcomer China National Materials Co. (1893.HK: Quote, Profile , Research) rallied nearly 24 percent at one point, a day after its strong debut. China Railway(0390.HK: Quote, Profile , Research) was also a star performer, as the world's third-largest construction contractor leapt on talk that it had won a bid for the high-speed Shanghai-to- Beijing railway project. Meanwhile, China's interest rate rise on Thursday was welcome news to investors, as it effectively removed an overhang in the market. "The Christmas rally is finally kicking in," said John Schofield. "The psychology of the market is finally changing and the latest interest rate increase (by China) is good news." "It's been such a bad six to eight weeks ... we'll see a reasonable uptick in the last week of the year." The benchmark Hang Seng Index <.HSI> closed up 2.3 percent, or 609.83 points, to end at 27,626.92, for a weekly gain of 0.2 percent. China Enterprises index of mainland H shares <.HSCE>, or Hong Kong-listed shares in mainland companies, gained 1.6 percent, or 249.03 points, to 15,981.81, up 0.2 percent for the week. Among property shares, Cheung Kong (0001.HK: Quote, Profile, Research) gained 4.5 percent to HK$140.6 and Sun Hung Kai (0016.HK: Quote, Profile , Research) raced up 4.2 percent to HK$160.2. The Hang Seng property sub-index <.HSNP> shot up 4.2 percent. Other large-cap gainers were Sinopec Corp (0386.HK: Quote, Profile , Research)(SNP: Quote, Profile, Research) (600028.SS: Quote, Profile , Research), which leapt 2.3 percent to HK$11.58. The country's No.2 oil and gas producer said it had found gas in northeastern China with 26 billion cubic metres of recoverable reserves. China Life (601628.SS: Quote, Profile , Research) (LFC: Quote, Profile , Research) (2628.HK: Quote, Profile , Research), the country's top life insurer, raced up nearly 3 percent to HK$40.6 and PetroChina (0857.HK: Quote, Profile , Research)(PTR: Quote, Profile, Research)(601857.SS: Quote, Profile , Research) scurried up 2.4 percent to HK$13.84. China Mobile (Hong Kong) Ltd. , (0941.HK: Quote, Profile , Research) (CHL: Quote, Profile , Research), the world's largest wireless telecoms provider, rose 2.2 percent to HK$137.80. ReutersReuters