Hong Kong stocks rebound on U.S. market gains

Hong Kong stocks closed higher on Tuesday tracking U.S. market gains, as property and airline stocks outperformed, ending their worst quarterly performance in six years the day before.

Hang Seng Index, the benchmark, opened slightly higher at 23,084.93 points in the morning session. After fluctuating between 22,700.50 and 23,305.71 points, the blue-chip Hang Seng Index rallied 288.26 points, or 1.26% to close at 23,137.46. Mainboard turnover edged up to HK$78.03 billion (US$10.02 billion) compared with HK$74.5 billion on Monday.

Hang Seng China Enterprise Index, which tracks the overall performance of 43 Chinese mainland state-owned enterprises on Hong Kong Stock Exchange, finished up 154.06 points or 1.27% to 12,237.36 points, though the Shanghai stock market lost more than 4% to an 11-month low on Tuesday.

Market heavyweight China Mobile<941>, the largest firm by capitalization in the Hong Kong market, gained 1.64% to HK$117.7.

Local property stocks rebounded after lagging recently with anticipation that further interest rate cut may not be forthcoming. Sun Hung Kai Properties Ltd<16>, the largest house developer in Hong Kong, gained nearly 2% to HK$123.8. Henderson Land Development Company Ltd<12> shot up 1.54% to HK$56.1. Cheung Kong (Holdings) Limited<1>, one of Hong Kong's largest real-estate developer owned by business giant Li Ka Shing, vaulted 2.53% to KH$113.3. Hang Lung<101> jumped 1.27% to HK$27.9.

Chinese airlines also outperformed yesterday. Air China<601111><753>, the country's flag carrier, surged almost 4% to HK$6.83. China Southern Airlines <600029><1055>, China's largest airline in terms of fleet size, advanced 1.32% to HK$6.17. China Eastern Airlines Corp<600115><670>, the third-largest carrier in China, remained unchanged to stay at HK$3.92. Hong Kong's dominant carrier Cathay Pacific<293> climbed nearly 2% to HK$15.6.