English/Nat
Hong Kong stocks opened dramatically higher on Wednesday on the back of a strong rebound overnight, making up for Tuesday's record point drop.
The blue-chip Hang Seng Index dropped below the 10-thousand points during yesterday's trading but opened at 10-thousand-130-point-47.
This was up one-thousand-70-point-58 points or 11-point-8 percent from Tuesdays close of 9-thousand-59-point-89.
A strong gain on Wall Street gave support to the Hang Seng Index on Wednesday, and
within minutes of trading the index further soared to around ten-thousand-400.
The gain virtually erased Tuesdays loss of 13-point-7 percent or one-thousand-438-point- 31, the biggest point drop in market history.
Experts, however, said the market would remain highly volatile, adding it was too early to say whether the recovery would hold throughout the day.
SOUNDBITE:(English)
"The rally in Wall Street clearly boosted confidence, put to some people at least a foundation stone under the market and obviously provided a platform for recovery during the day. It's a brave person though who says that this rally is heading the market fundamentals in a different direction but I think it's still in a volatile period where a lot can happen"
SUPER CAPTION: David Dowell, Jardin Flemings
Although with the recent stock plunge, the SAR Government has repeated assured investors and Hong Kong stock shareholders that the fundamentals of the Hong Kong's economy is very good.
Chief Executive Tung Chee-hwa also repeatedly said that his government is determined to keep the HK Dollar peg which has been practised during the past 14 years.
Hong Kong stocks were making modest gains in London overnight after the Dow Jones Industrial Average bounced back to 7-thousand-498-point-32 points, rising by some 4- point-7 percent.
SOUNDBITE:(English)
"There has been a awareness that the likely need for big correction in Wall Street is going to hurt the Hong Kong market, there's been a cloud over the market for a long time, I think during yesterday when the markets were expecting a further fall in
the United States, there was a feeling that has been hanging over the markets from Wall Street was about to be dissipated, unhappily with the rally is the question that has to be with a question mark over whether the cloud has been dissipated."
SUPERCAPTION: David Dodwell, Jardin Flemings
Positive signs also came from Australia, New Zealand and Japan in the early hours of the morning, which registered an upward trend immediately after opening the trading session Wednesday.
Hong Kong stocks have lost some 30 percent since a record high in August, prompting some economists to revise down economic growth projects.
Analyst say the highly sensitive property market is likely to drop heavily due to the high interest rates and consumer power is also underminded in the territory.
SOUNDBITE: (English)
"For anybody who's borrowed heavily is going to feel, I think some pain for sometime because interest rate, I don't think is going to come down in anyway quickly. And of course a lot of people went in debt because they've borrowed for mortgages which is
hurting doubly. We haven't really seen concrete evidence of the fall in the property market in HK with the result from the corrections from last week, I think you can say that with some reasonable confidence, property market is likely to come off quite substantially over the coming months."
SUPERCAPTION: David Dowell, Jardin Flemings
The Hong Kong Government also said they do not see any need to intervene with the markets and assured investors not to worry.
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