HK buyers bet on swift HSBC recovery

HSBC, the giant of the

The London-headquartered bank put on 50 cents or 0.5% to HK$116 and plenty of analysts think it could reach HK$130 or beyond should local and global economic conditions continue to improve.

Like the wider market, the bank bottomed out for the year in late April, trading a shade under HK$ 80. Since then it has rebounded by 50% to a recent high of HK$120.50 on signs that the global recovery has become firmly entrenched.

Conditions in Hong Kong, a core market, have also become much rosier. This jobless rate is ticking down, an end seen to the debilitating deflation of recent years, and economic growth could exceed 5% next year.

The strike in Istanbul is ecpected to knock HSBC - with its global reach and diversified earnings - of course.

The company's executives appear keen on further acquisitions, and HSBC is currently thought to be in the running to take over KorAm Bank, the sixth-largest lender in South Korea. HSBC faces competition in that race from rivals Standard Chartered, Citigroup, and a Singapore government bidder, Temasek.

There was a similar modest gain for Bank of East Asia, up five cents to HK$23.20, as it recouped some losses inspired by profit-takers.

HSBC's local affiliate Hang Seng Bank trod water, level at HK$97.50. It has recently pulled back after pushing to a high of HK$100.50.

The 33-member Hang Seng was little changed, up 15.13 points at 11,854.93. Brokers said trade was lacklustre with Tokyo markets closed today, coupled with a holiday-shortened week in the US.

Developers, which have slipped recently as investors took profits, saw a further pullback. Cheung Kong, controlled by Asia's richest businessman Li Ka-shing, fell 25 cents or 0.4% to HK$58, while Henderson Land Development was off 15 cents or 0.5% at HK$29.

In Singapore, there were further gains for Mobile One, the island's second-largest mobile phone company. It rose four cents or 1.8% to S$1.45 ahead of the expiry next month of a lock-up on sales by four founding shareholders, who collectively control 40%. One of those founders is Britain's Cable & Wireless, which has a 6% stake.

Undercut by profit-taking in banks, the Straits Times index eased 7.7 points to 1649.55. Statelinked DBS Group traded at S$13.30, down 10 cents or 0.8%.

Australia's WMC Resources fell 21 cents to A$4.57 after it said a glitch in copper production would hit profits by A$1m (£425,000) for two to three weeks.

Telstra, the phone company,for two to three weeks. Telstra, the phone company, four cents or 0.9% to A$4.91 after it fleshed out details of a A$1bn share buyback. The All Ordinaries was little changed, up 0.4 points at 3175.70.

Woes about liquidity problems in the credit card industry depressed the Korean Composite Stock Price Index, down 16.03 points or 2.1% to 754.75.