Hong Kong stocks ended up 0.28 percent Friday following another record close on Wall Street, while investors look ahead to the start next week of the much-anticipated link-up with the Shanghai exchange. The Hang Seng Index added 67.44 points to 24,087.38 on turnover of HK$72.63 billion ($9.37 billion). The Shanghai-Hong Kong Stock Connect launches Monday giving traders in each market access to the other, with expectations for almost $4 billion of transactions taking place daily.
Shares in both cities have rallied since the link-up's start date was announced earlier this month, with global investors salivating at the prospect of investing in the tightly controlled mainland market. Hong Kong stocks enjoyed a positive week despite more weak Chinese economic data, with investors helped by several record closes on Wall Street.
China Construction Bank added 0.17 percent to HK$5.78, Tencent climbed 1.85 percent to HK$131.90 and Henderson Land Development put on 0.58 percent to HK$52.00. However, HSBC eased 0.45 percent to HK$77.85 and Cathay Pacific lost 0.25 percent to HK$15.68. In mainland China the benchmark Shanghai Composite Index fell 0.27 percent, or 6.79 points, to 2,478.82 on turnover of 191.9 billion yuan ($31.3 billion). The index gained 2.51 percent for the week. The Shenzhen Composite Index, which tracks stocks on China's second exchange, slid 0.24 percent, or 3.16 points, to 1,322.62 on turnover of 147.2 billion yuan. It dropped 2.34 percent over the week.
The losses come as 12 companies prepare to issue shares for investor subscription from Monday, while more are expected to follow after China's market regulator approved a new batch of 11 initial public offerings on Thursday. The sell-off is "mainly due to the pressure of a possible share glut. There's always a correction in stock prices before new share offerings", BOC International analyst Shen Jun told AFP.
Analysts suggested mainland investors may stay away from investing heavily in Hong Kong owing to a lack of a knowledge about the market. Sinolink Securities eased 3.36 percent to 14.39 yuan while Industrial Securities dropped 2.25 percent to 8.27 yuan. Lanzhou LS Heavy Equipment tumbled by its 10 percent daily limit to 18.32 yuan in Shanghai while Phichem Material also dived 10 percent to 70.19 yuan in Shenzhen.
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