China Mobile boosts shares

Hong Kong stocks gained on Friday as the forecast-beating earnings of index heavyweight China Mobile (Hong Kong) Ltd fuelled the market to its highest close in nearly two weeks.

The benchmark Hang Seng index ended up 0.46 per cent at 15,801.66 to log a weekly gain of 2.3 per cent.

The day's turnover was HK$31 billion (US$4 billion), up from

Thursday's HK$24 billion and on par with the HK$31.5 average daily volume of the first two months of the year.

"China Mobile is giving the market a shot of confidence," said Tat Auyeung, portfolio manager at Apex Capital Management (Hong Kong) Ltd. "We expected good numbers, but this is a blow-out."

China Mobile (Hong Kong) Ltd ended on Friday up 1.7 per cent at HK$38.20 after it reported a 30 per cent jump in fourth-quarter earnings.

But some analysts said the market had lost some of its former lustre.

"Liquidity is not as good as it was earlier in the year," said Benny Yu, analyst at VC Brokerage. "The market can only perform slightly better on good news."

Telecommunications equipment makers, such as ZTE Corp and Comba Telecom Systems Holdings Ltd rose on the back of China Mobile's strong results. ZTE surged nearly 7 per cent to HK$30.35 and Comba raced 10 per cent to HK$3.025.

The city's railway operator MTR Corp led blue-chip gains, setting record highs before closing up 5 per cent at HK$18.0 as the planned merger with Kowloon-Canton Railway Corp draws near.

Lenovo Group Ltd jumped 2.4 per cent to HK$3.175 after the computer maker said on Thursday that it was seeking to achieve US$250 million in annual savings in a restructuring plan that would cut 1,000 jobs, or about 5 per cent of its workforce.

(HK Edition 03/18/2006 page3)