Market commentary from the site you posted:
1999-12-29
Pacific Century CyberWorks, 1186, reached
$20, a price that values the company at $166
billion, which is virtually the same as the
capitalisation of the Hang Seng Bank, 11, and
only slightly lower than Richard Li's father's
company, Cheung Kong Holdings, 1, at $226
billion or Sun Hung Kai Properties, 16, at $198
billion.
This price defies any logical explanation, as this
company is merely a venture capital company
with stakes in various I-tech compnaies, and has
nothing to produce revenue except the surplus
capital on deposit and the rent from a property in
China. Otherwise this is a concept stock and the
trading boards of many national stock
exchanges are littered with the remains of most
other concept stocks which have failed to match
up to expectations. Perhaps today after this
outrageous excess the expectations are
sufficiently high that no amount of achievement
could justify them. Perhaps an exchange of
shares with Hutchison Whampoa, or a takeover,
could mark this level temporarily justified, but it
could only defer a massive corrrection dragging
its shining knights down with it.
Nevertheless turnover of $2.6 billion in
CyberWorks, which raised its price level by
$3.55, or 22%, to $19.50 at the close, had lifted
the overall trunover to $16.7 billion, the second
biggest turnover of 1999. The HSI had
consequently closed at 16,928 falling slightly
short of the next magic 17,000 level, after
trading through a range of from 16,810 to
16,979. This was 95 points higher than the
pre-Christmas all-time record high. Advances, at
358 issues, outnumbered declines, at 269
issues, whilst the outstanding open position on
December futures, which closes today, was
down to only 7500 contracts. The open position
for January is also lower at only 30,000 open
contracts. |
