HK stocks reverse course, end lower on earnings fears
Reuters, 01.31.02, 4:04 AM ET
forbes.com
By Susan Fenton
HONG KONG, Jan 31 (Reuters) - Hong Kong stocks surrendered early gains to end slightly lower on Thursday as hopes for a global economic recovery were tempered by growing caution ahead of the start of the local earnings reporting season next week.
Property developers however mostly held up on signs that demand for property is picking up.
The Hang Seng Index ended down 0.29 percent, or 31.66 points, at 10,725.30 after spending most of the day in positive territory, hitting 10,953.57 in morning trade on the back of the unexpected growth in the U.S. economy.
The United States is Hong Kong's second biggest export market after mainland China.
Turnover at HK$8.05 billion (US$1.03 billion) was just above its 20-day moving average of HK$7.9 billion.
"I think the market will hover between 10,500 and 11,000," said Eric Wong, market strategist at Dao Heng Securities. "The Hang Seng has the possibility to test 14,000 by the end of the year as we see the Hong Kong economy recovering in the fourth quarter. But I think some unpleasant earnings reports will push down the index and there will be a better opportunity to buy in early February."
The market got off to a strong start after the U.S. reported a slight rise in gross domestic product growth for the final quarter of 2001, defying expectations for a contraction, and the Federal Reserve left interest rates unchanged, signalling its confidence that the American economy is emerging from recession. |
