HONG KONG: Hong Kong shares finished higher for a fourth straight session on Wednesday powered by strength in Chinese resources-related stocks, with speculation rife in the mainland that Beijing will soon loosen its policy position.
The Hang Seng Index closed up 0.52 percent at 19,066.54. The China Enterprises Index of top Hong Kong-listed mainland companies finished up 1.92 percent at 10,050.59.
The Shanghai Composite Index closed up 0.74 percent at 2,427.48, its third straight gain, after Chinese Premier Wen Jiabao's pledge to fine-tune the country's economic policy spurred talk that policy could ease in the near term.
HIGHLIGHTS:
Gains on Wednesday edged the Hang Seng Index nearer to the gap that opened up between 19,247 and 19,454, the low on Sept. 18 and high on Sept. 19, seen as offering near-term resistance. But turnover stayed below average on Wednesday, as it has all week, suggesting longer term investors were sitting out ahead of the euro zone meeting and third-quarter earnings from Chinese companies later in the day.
Resources-related stocks led gains, with Aluminum Corp of China Ltd (Chalco) defying its unfavourable earnings by gaining 3.9 percent in Hong Kong and 2.6 percent in Shanghai in volumes more than twice its respective 30-day averages. Analysts said the move was more associated with higher global commodities prices than company-specific factors and further boosted by hopes for easier economic policy after Premier Wen's comments late on Tuesday.
Weakness in Hong Kong property held back the Hang Seng Index for much of the day. In a report dated Oct. 26, Barclays analysts said office rents in Hong Kong would likely fall by at least 10 to 15 percent in the next two years and could drop by as much as 40 percent in a "hard landing" scenario. Sun Hung Kai Properties Ltd , Cheung Kong Holdings Ltd and Henderson Land Development Co Ltd were the top three drags on the Hang Seng Index.
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