HK property prices drive up Sino Land

A TRIO of

The best performer was mid-tier developer Sino Land, sometimes overshadowed by its more illustrious peers such as Cheung Kong and Henderson Land Development.

Sino stock jumped 17.5 cents or 4.6% today to HK$4.025 amid investor optimism that the company is well placed to benefit from a recovery in local property prices. Sino itself said this week that it expects to raise residential prices soon on strong demand.

Such signals are welcome in a city where property prices - the bedrock of the local economy - have fallen almost continuously since the 1998 financial crisis. But with signs of a turnaround apparent in recent months, the sector has pushed higher.

That has prompted some analysts to say the rerating is complete. Sino's comments suggest, however, that further gains may be in store. Sino's stock has doubled from lows of about HK$2 in May. It recently peaked at HK$4.40.

De facto flag-carrier Cathay Pacific Airways rose on confirmation that it had secured rights to the transatlantic route from Heathrow to JFK in New York, subject to European Commission approval. The shares rose 35 cents or 2.5% to HK$14.90.

Shares in Cathay's principal shareholders were also up today. Conglomerate Citic Pacific firmed 10 cents or 0.6% to HK$17.75, while Swire Pacific traded at HK$45.70, better by 40 cents or 0.9%.

Global lender HSBC pushed back towards recent highs after a bullish long-term strategy presentation from senior executives. They said smaller acquisitions were on the cards, while some jobs would be shed in the equities division.

The shares gained HK$1 to HK$118.50. They recently topped out at HK$120.50.

The Hang Seng index put on 131.91 points or 1% to 12,207.9 as enthusiasm was fanned by the impending data release. Hutchison Whampoa, the conglomerate headed by billionaire Li Ka-shing, rose 75 cents to HK$56.25, up 1.6%.

Tokyo shares had a softer bias on signs that a small regional bank, Ashikaga Financial, may yet need an injection of State funds.

The bank, whose shares were suspended, said media reports it was in need of public money were speculative, but government officials suggested a rescue was only a matter of time.

Amid this uncertainty the Nikkei 225 backtracked 101.59 points or 1% to 10,061.79, with downward momentum given extra weight by profit-taking, before recovering to close at 10,100.57, down 62.81. Highflying mobile player NTT DoCoMo was clipped by 1000 yen or 0.4% to 239,000, while airline Japan Airlines System was punished 11 yen or 3.8% to 276.

In Australia British Airways affiliate Qantas felt the downside of the Hong Kong air deal, under which Virgin Atlantic Airways also secured rights to fly direct into Sydney. Qantas fell nine cents or 2.7% to A$3.31.

With no guidance from the US, where markets were shut on Thursday, there was little appetite for pushing prices much higher. The All Ordinaries index drifted 1.4 points upwards to 3195.7. Despite a robust defence of its British operations, National Australia Bank eased 29 cents or 1% to A$28.97.