Hong Kong stocks stood relatively firm yesterday after Tuesday's massive drop, but H-shares tracked a slide in the mainland markets.

The benchmark Hang Seng Index (HSI) fell just 0.21 percent, or 47.92 points, to close at 23,327.60 after Tuesday's 4.21 percent plunge cost the HSI 1,026.66 points.

Investors hunted for bargains. Heavyweight HSBC bounced back, with share prices rising 0.39 percent to close at HK$128.30. Cathay Pacific also recovered 1.42 percent.

Mainland lenders dropped sharply on Tuesday on the fears of further tightening measures, but the banks stabilized yesterday.

China Construction Bank rose slightly by 0.15 percent, while Industrial and Commercial Bank of China gained 0.73 percent.

Shares of mainland telecommunication firms also attracted investors.

China Netcom rose 2.16 percent and China Unicom shares gained 1.29 percent. COSCO Pacific, however, lost 8.47 percent after resuming trade following Tuesday's suspension.

The port operator said the huge disparity between the reported values of its bid - the 500 million euros it announced last week and the 4.3 billion euros reported earlier - to run and upgrade Greece's Piraeus Port, stemmed from a difference in accounting standards and the inclusion of certain fees.

Oil stocks led the slide, Sinopec closed 2.71 percent lower, and PetroChina gave up 0.77 percent. Shares in CITIC Bank and Bank of Communications lost 4.81 percent and 1.34 percent, respectively.

Mainboard turnover fell to HK$62.91 billion from HK$82.16 billion on Tuesday, and investors were apparently being cautious before the announcement of the mainland's consumer price index (CPI).

"Investors overreacted on Tuesday," said Dickie Wong, a director of Friedmann Pacific Investment. "I don't see that the global markets are deteriorating; Hong Kong stocks shouldn't have fallen so much."

Wong expects the index to find support at the 23,300 level. However, the mainland's CPI will be a crucial factor in determining the stock trend.

"The market expects the May inflation to slow down," Wong said. "If the figure is out of expectations, the stock markets will be dragged further."

He said the 23,300 mark is an important technical level. And if the HSI falls below that, a further correction may be seen.

(HK Edition 06/12/2008 page2)