Friday, 29 December 2006

Hang Seng hits 20,000

The Hong Kong stock market hit a milestone yesterday. AP reports:

Hong Kong shares rallied to a record high for the third consecutive session, on the back of strong fund inflow and rotational buying in blue-chips.

The blue-chip Hang Seng Index rose 276.18 points, or 1.4 percent, to 20,001.91 - the first time the index has risen above the 20,000 point.

Perhaps it is getting a bit too much for some.

"You only experience this kind of market craziness perhaps every five or six years," says Alex Wong, a fund manager of Shenyin Wanguo Asset Management.

A peak perhaps? But Peak prices are also rising. AFP/CNA reports:

Confidence in Hong Kong's property market, a key barometer of the territory's financial well-being, is at an all-time high after bidders paid a record price for a luxury site, appropriately located on 'The Peak'.

Analysts said developers were ready to pay more after one of the top local companies put up 231 million US dollars to develop a top end luxury complex...

"The auction reflects the Hong Kong economy is getting better. It also shows investors are positive about the prospects for the property market," said Wong Leung-sing, associate research director for Centaline Property Agency.

"Even the stock market has broken records; it's about time that the property market breaks records, too," he said.

Meanwhile though, US stocks were not able to continue their recent record-breaking run. Reuters reports:

U.S. stocks finished slightly lower on Thursday as investors sold off recent outperformers to secure profits before the year-end. Concerns about stock options grants at Apple Computer Inc. dragged on the Nasdaq...

The Dow Jones industrial average slipped 9.05 points, or 0.07 percent, to end at 12,501.52. The Standard & Poor's 500 Index dipped 2.11 points, or 0.15 percent, to finish at 1,424.73. The Nasdaq Composite Index declined 5.65 points, or 0.23 percent, to close at 2,425.57.

This was despite a good day on the economic news front. Again from Reuters:

The National Association of Realtors said the pace of existing home sales rose 0.6 percent in November to a 6.28 million-unit annual rate, defying Wall Street forecasts for sales to ease slightly and providing the latest suggestion that housing activity was stabilizing after a steep drop.

Separately, the Conference Board said its index of consumer sentiment climbed to 109.0 in December -- the highest since April -- from an upwardly revised 105.3 in November as consumers' views on the labor market improved.

In addition, the National Association of Purchasing Management-Chicago said its gauge of U.S. Midwest business activity rose to 52.4 from 49.9 in November, moving back above the 50 line in a sign activity was expanding...

Earlier on Thursday, the U.S. Labor Department said the number of workers applying for first-time jobless benefits rose 1,000 to 317,000 last week, suggesting stable labor-market conditions. Wall Street economists had expected claims to rise to 320,000.

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