Hong Kong's top shares rose for the ninth straight day on Thursday as investors picked up telecom stocks such as China Unicom Ltd which have lagged the broader market and ditched property plays.
Supply chain manager Li & Fung Ltd was another top blue chip gainer as investors hoped new licensing deals with Levi Strauss & Co and Official Pillowtex L.L.C. would boost earnings.
It rose 7.41 percent to HK $14.50.
The benchmark Hang Seng Index ended up 0.35 percent, or 46 points, at 13,203.59, a fresh two and a half year high.
China Unicom shot up 10.62 percent to HK $8.85.
"Their operating environment has improved and telecoms are not as expensive as other stocks," said Joseph Lau, a director at Tai Fook Asset Management.
Turnover tailed off slightly to HK $24.6 billion (US $3.17 billion) from Wednesday's HK $26.1 billion but was still above the recent average of HK $18 billion.
Losses were led by property stocks, which fell 1.68 percent after a policy speech by Chief Executive Tung Chee-hwa on Wednesday failed to offer any measures to prop up the sector.
Sun Hung Kai Properties Ltd fell 1.76 percent to HK $69.75, while Cheung Kong Holdings dropped 2.26 percent to HK $64.75 and ports-to-property conglomerate Wharf Holdings lost 2.58 percent to HK $22.65.
The losses whittled away a 10-percent jump in the first three sessions of the year.
A second suspected Sars case in the southern Chinese province of Guangdong, which borders Hong Kong, had little market impact but some brokers said the market was due for a fall.
"Correction pressure is building up. We've gone up a 1,000 points since Christmas," said Andrew To, sales director at Tai Fook Securities.
Hong Kong-listed Chinese firms, known as H shares, faced further selling pressure - dogged by concerns of more share placements. The index fell one percent to 5,028.21.
Oil major PetroChina fell 3.39 percent to HK $4.275 on speculation that it would become the latest firm to capitalise on high stock prices and place shares, but the company told Reuters it had no such plans.
Jiangxi Copper Ltd, China's largest producer of the red metal, lost 6.44 percent to HK $4.725. But two smaller firms had a good session.
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