Investors Worry Reshuffle Of Indexes Will Hurt Shares
Dow Jones Newswires
HONG KONG -- After a rally Thursday, shares closed lower in moderate trading Friday as investors await a reshuffle of the widely watched Morgan Stanley Capital International indexes to be released Saturday.
The blue-chip Hang Seng Index ended 1.3% lower, or 178.69 points down, at 13459.18, after trading in a narrow range of 13449.04 and 13631.40. The broader All Ordinaries Index finished down 59.30 points at 5678.09.
As a result trading volume thinned to 8.28 billion Hong Kong dollars, from HK$10.08 billion in the previous session.
MSCI on Saturday will announce new constituents to its indexes based on a free-float system, which will calculate index weightings based on shares available to the investing public -- not good news for Hong Kong stocks, which have high levels of family and government ownership.
The indexes are widely tracked by fund managers, who will likely make portfolio adjustments based on the changes, analysts said.
Expectations that Hong Kong's commercial banks, at their weekly meeting after the market close, will cut interest rates by 0.50 percent -- in line with the U.S. rate cut earlier this week, did little to spur trading, analysts said.
China Mobile fell 1.5%, or 60 Hong Kong cents, to HK$38.40 as investors cashed in on Thursday's 4% gain. HSBC, which rose 2.9% in the previous session, fell 1.8% to HK$97.50. China Unicom slipped 5 cents to HK$12.00 after a 3.9% rise in the previous two sessions. Hutchison fell 2.3% to HK$85.25.
Pacific Century CyberWorks bucked the trend, rising 2.5 HK cents, or 0.9%, to HK$2.75 on news reports that Chief Executive Richard Li plans to cede day-to-day control of the company within a year and hire a new chief executive. Analysts said the gain in shares may not be linked to speculation about Mr. Li, though most expect fresh blood in the company will help revive its fortunes.
i-Cable Communications rose 2.7%, or 12.5 cents, to HK$4.775, after hitting a high of HK$4.825 on news that its first quarter revenue jumped 20%.
Newcomer Q9 Technology Holdings, which is engaged in software and embedded systems development, slipped 6.7%, or 3 HK cents, from its 45 cent share offer price on its debut day on the Growth Enterprise Market. Trading volume reached HK$86.21 million.
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