Property stocks propel Hong Kong shares to record

Hong Kong stocks swerved from losses to a 1.3 percent gain on Friday after mainland bourses rebounded sharply, setting off a broad-based rally that sent the market to its fourth-straight record high.
Ample funds drove turnover to near record levels as investors ploughed into underplayed blue chips, including Hong Kong property play Cheung Kong (Holdings) Ltd, a departure from recent rallies which have been led by China plays.
This led property stocks to their best day in six months while Hong Kong conglomerate Hutchison Whampoa rallied more than 6 percent to six-year highs. The bullish climate helped fire the debuts of Taiwan-based shoe maker Stella International and network products maker Delta Networks Inc.
"People are chasing the big-cap laggards, effectively those stocks that haven't had their run - this is their day," said Tat Auyeung, fund manager at APEX Capital Management. Profit-taking hit shares in the morning but by lunch, the market turned a sharp corner as global lender HSBC Holdings ramped up.
Hong Kong is expected to be the primary beneficiary of QDII because mainland investors are familiar with the many Chinese companies listed here. The benchmark Hang Seng Index fell as much as 0.8 percent before hitting its fourth-straight intraday record at 22,565.43. It closed up 278.75 points at 22,531.74, its highest-ever finish, logging a 3.5 percent weekly gain.
The China Enterprises Index rose 0.8 percent to end at 12,681.44, its highest closing level, up 5.7 percent for the week. "The fact that we stayed above 22,000 level even though there's profit-taking pressure means the trend will remain positive," said Kenny Tang, associate director at Tung Tai Securities. "We may hit 22,800 next week."
Mainboard turnover was the sixth-highest ever at HK$88.09 billion (US $11.3 billion). Hong Kong properties starred in the day's rally, with the Hang Seng property sub-index jumping 3.7 percent, its best one-day percentage gain since early January.
Cheung Kong shot up 7.1 percent to HK$110.20, bolstered by Credit Suisse's price target increase to HK$122 per share, up from HK$116. Sun Hung Kai Properties gained 3.1 percent to HK$97.75. Hutchison, helped by a Merrill Lynch target price hike to HK$98 from HK$92, bolted 6.3 percent to HK$83.
Shares in newcomer Stella ended at HK$18.44, a 19 percent jump over their IPO price of HK$15.50, which was at the top of an indicative range. Delta Networks, a spin-off from Taiwan-based Delta Electronics, finished at HK$5.44, rising nearly 21 percent above its issue price of HK$4.50, which was also at the top of an indicative range.
HSBC, the day's most active stock, settled up nearly 1 percent to HK$144.50. Industrial & Commercial Bank of China surged 1.8 percent to HK$4.61 and China Construction Bank hit its third-consecutive high before ending at HK$5.85, up 1.4 percent.
Among losers, the first nine state-owned mainland firms to list in Hong Kong fell on the prospect of an end to the preferential tax breaks they have enjoyed for more than a decade. Sinopec Yizheng fell 5.4 percent to HK$3.32. Sinopec Shanghai Petrochemical dropped 1.6 percent to HK$5.02.