Hong Kong shares mark best week in 2-1/2 years

Hong Kong shares gained 1.7 percent on Friday, rounding off its best week in almost 2-1/2 years, boosted by property and financial stocks with global risk aversion ebbing following a deal that could ease Europe's debt problems.
For the week, the Hang Seng Index surged more than 11 percent, its best weekly performance since early May 2009. The Shanghai Composite Index had its best week in a year, jumping 6.7 percent. Turnover on the Hong Kong bourse this week was the highest since mid-August, but was significantly lower than levels seen during two later selloffs last quarter sank the Hang Seng to its worst quarterly performance in a decade.
---- Shanghai index up 6.7pc for week
A good portion of this week's gains came on short-covering in sectors that have been heavily shorted in the last two weeks despite short-selling dipping below 10 percent of overall turnover in all but two of the last 15 sessions. Full data for Friday is not available at market close.
Chinese financial, property, resources and infrastructure stocks took the brunt of a brutal selloff last quarter, but led this week's rebound, following data and corporate earnings that suggested fears of a hard landing in China could turn out to be excessive.
"We probably won't see new lows this year, but this is just a reversion to mean. Nothing fundamentally has changed too much," said Benjamin Chang, chief executive officer of LBN Advisors, a firm that manages $450 million worth of assets in two China funds.
On Friday, the Hang Seng Index closed at 20,019.2 points. It has recovered about two-thirds of its 26 percent decline from the closing level on August 4 to a trough on October 4. Chinese names were boosted this week by the mainland authorities showing signs of possible policy adjustments. The China Enterprises Index of the top mainland firms listed in Hong Kong jumped 15.2 percent this week.
China property names were among those that saw the most dramatic moves. They were further lifted by the housing minister's statement on Thursday that housing purchasing restrictions were a temporary measure. Mainland media reported on Friday that the authorities intended to replace home purchase restrictions with a plan involving the expansion of property taxes.
Evergrande Real Estate Group Ltd gained 5.5 percent on Friday and rose more than 40 percent for the week. China Resources Land Ltd and China Overseas Land & Investment Ltd surged 30.6 percent and 29.7 percent this week, respectively. In the mainland, property issues also lifted the Shanghai Composite Index. The benchmark gained 1.5 percent on Friday to finish at 2,473.4 points, with A-share turnover at the highest since July 25.
The Shanghai property sub-index was up more than 6 percent in early Friday trade then cooled and closed up 3.5 percent. Poly Real Estate Group Co Ltd gained 4.4 percent in more than twice its 30-day average volume. Ahead of its third-quarter earnings report after Friday's market closes, China Merchants Bank Co Ltd closed up 1.7 percent in Shanghai and gained 5.5 percent in Hong Kong.