The Hang Seng Index (HSI) saw a sharp rebound for the first time in four trading days in anticipation of the central government launching a string of policies to revive the country's economy.

The index yesterday shot up 768 points to 15,323 after opening trading leaped 632 points. That increase came despite the mainland's announcement that it achieved just a 9.9 percent GDP growth in the third quarter - the lowest since 2005.

The rally gathered its pace in the afternoon as the central government unveiled a policy of cutting property transaction fees. The index eased at 15,323, up 5.28 percent.

"The worst of the downside spiral seems to be over temporally, but the index might test the bottom at the level of 13,000 early next year," said Ricky Cheung, executive and vice president of Enlighten Securities and Futures.

In the short run, he said, he believes the index will linger between 14,400 and 17,000.

Heavyweight index constituents significantly contributed to the gain. China Mobile, the mainland's largest wireless service provider, rose 7.56 percent to HK$71.10. And shares of HSBC climbed 1.71 percent to HK$107.

Local property stocks also advanced significantly. Cheung Kong Holdings went up 6.99 percent to HK$76.50, while Sino Land increased about 10 percent to settle at HK$8.30. Sun Hung Kai Properties rose 8.49 percent to HK$68.30.

A UBS report gave a "buy" rating to conglomerate Hutchison Whampoa, predicting cash flow of the company's 3G business will climb into the black in 2009. The report boosted the firm's shares, rising them 10.09 percent to HK$48.00.

China Construction Bank increased 4.85 percent to HK$3.67 after JPMorgan raised the lender's rating from "neutral" to "overweight". ICBC, the largest mainland lender in terms of market value, added 7.47 percent to ease at HK$3.88.

Shipping carrier Orient Overseas (International) rose 2.70 percent to HK$15.20 after the company reported yesterday a 16 percent increase in third-quarter revenue to HK$1.64 billion.

But clothing retailer Esprit Holdings fell 3.98 percent to HK$41 after the company's chief executive officer, Heinz Krogner, predicted its wholesale growth will be close to zero in 2009.

And Lenovo Group, the mainland's largest personal-computer maker, lost 3.39 percent to HK$2.56 as Goldman Sachs downside-revised the stock's share-price estimate by 33 percent to HK$3.50.

The Hang Seng Chinese Enterprises Index, which gauges the performances of mainland enterprises, soared 433 points to 7,441.13.

(HK Edition 10/21/2008 page2)