Tuesday, August 30, 2011

HK shares close up 1.7 pct, mainland plays outperform

HONG KONG: Hong Kong shares gained for a second straight session on Tuesday, Aug 30, boosted by China-related counters, with turnover at the highest in more than a fortnight.

The Hang Seng Index ended up 1.71 percent at 20,204.17. The China Enterprises Index finished up 2.24 percent at 10,747.08.

The Shanghai Composite Index pared early gains to close down 0.38 percent at 2,566.59 points as A-share turnover stayed below average.

HIGHLIGHTS:

* Turnover surged to the highest since Aug. 9, largely on the Bank of America Corp's sale of an $8 billion stake in China CONSTRUCTION [] Bank Corp (CCB) , which accounted for about 3 percent of all shares traded on the Hong Kong bourse.

* News of the stake sale spurred the H shares of the world's second-largest lender by market value to climb more than 4 percent by midday, but later eased to end with a gain of 1.8 percent.

* Short selling on CCB was more than 5 percent of total volume at midday, suggesting investors remained cautious on the stock despite the BofA sale removing a source of uncertainty. Other than asset quality concerns, Jackson Wong, vice-president of equity sales at Tanrich Securities, said investors were also concerned about who bought BofA's stake other than Singapore state fund Temasek Holdings Pte Ltd . - Reuters

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