WSJ:HK Shares End Higher As Oil Prices Fall; Cathay Pacific Up
HONG KONG (Dow Jones)--Hong Kong shares ended higher Tuesday, tracking gains in regional markets as upbeat U.S. data and a drop in crude prices helped investment sentiment.
The blue-chip Hang Seng Index rose 350.87 points, or 1.65%, to 21,568.73 after trading between 21,273.99 and 21,583.07 during the session.
Market volume totaled HK$62.42 billion, down slightly from HK$64.57 billion Monday.
Analysts said the market may correct itself in the near term as the HSI has risen almost 4,000 points from its Dec. 19 low of 17,821.
"A lot of positive news appears to be already priced in. At this stage, the market (as reflected by the benchmark index) may not move much, but individual stocks may rise or fall sharply, with a key focus on their results," said Ben Kwong, chief operating officer at KGI Asia.
The market got a boost from better-than-expected readings on the U.S. housing market and the decline in oil prices. At 0839 GMT, benchmark April Nymex crude oil futures were down three cents at $108.53.
Cathay Pacific rose 5.7% to HK$14.88 and was the best-performing blue chip, as lower oil prices eased concerns about its fuel costs.
Local property firms gained because of expectations for a recovery in the city's property market.
Nomura said that while Hong Kong home prices are down 1.14% so far this year a turnaround is likely to come soon. According to estate agents, most of the city's more attractively priced resale units have been snapped up, which suggests that potential buyers will have to start chasing higher-priced units soon, the bank said.
Sun Hung Kai Properties rose 2.6% to HK$120.40 and Sino Land advanced 2.0% to HK$14.08.
Hang Seng Bank surged 5.1% to HK$106.70 after the blue-chip lender reported Monday a 12% rise in 2011 net profit, driven by higher net interest income.
Bucking the trend, HSBC fell 0.6% to HK$69.15 despite a 27% rise in its 2011 net profit as it said its costs continued to rise last year.
"Although there is downgrade risk in the sector generally, we see less risk at HSBC and Standard Chartered and reiterate our Buy rating on the back of these results," Nomura said.
-By Yvonne Lee, Dow Jones Newswires; 852-2802-7002; yvonne.lee@dowjones.com
