Hong Kong stocks end flat
Market watch top headlines
HONG KONG, Dec 18 AFP
December 18 2012, 9:50PM
Hong Kong shares have finished flat as an afternoon sell-off wiped out earlier gains despite growing hopes of a deal in Washington to avert the US fiscal cliff.
The benchmark Hang Seng Index on Tuesday eased 18.88 points to close at 22,494.73 on a huge turnover of HK$118.22 billion ($A14.52 billion), thanks to trade in AIA after American International Group sold its final stake in the Asian insurer.
The market spent most of the day in positive territory, in line with a regional rally, after US President Barack Obama and top Republican lawmaker John Boehner met in the White House for 45 minutes on Monday.
The talks were the latest effort to avert the fiscal cliff of tax hikes and spending cuts and follow news Boehner had changed his position on not allowing any more taxes.
He said at the weekend that he would agree to some hikes for people earning more than $US1 million.
Wall Street ended on a high, with the Dow closing up 0.76 per cent, the S&P 500 gaining 1.19 per cent and the Nasdaq adding 1.32 per cent.
The HSI was weighed down by a 3.3 per cent fall to $HK30.60 in AIA after the AIG sale, which fetched $US6.45 billion ($A6.14 billion). However, the firm still managed to finish above the $HK30.30 price at which AIG sold.
China Overseas Land fell 1.9 per cent to $HK22.95 but is still up 76.8 per cent for the year to date. China Resources Land slid 1.9 per cent to $HK19.96.
Chinese shares ended up 0.10 per cent, extending their winning run to three days after leaders said they would push to increase domestic demand in the new year.
The benchmark Shanghai Composite Index added 2.12 points to 2,162.46 on turnover of 99.0 billion yuan ($A15.14 billion).
China "will continue to implement the proactive fiscal policy and prudent monetary policy in 2013" and make domestic demand a top priority, the new leadership said at a key economic conference at the weekend.
Soochow Securities analyst Deng Wenyuan told Dow Jones Newswires: "One of the major drivers for China shares are expectations for macro policy easing."
However, he cautioned: "I think investors might have been too optimistic about that," adding aggressive monetary easing is unlikely given still-high property prices.
Rising Nonferrous Metals surged by its 10 per cent daily limit to 47.55 yuan, Baotou Steel Rare Earth jumped 5.05 per cent to 36.17 yuan and Xiamen Tungsten rose 2.48 per cent to 36.72 yuan.
Qinling Cement also soared by 10 per cent to 6.88 yuan while Taiyuan Lionhead Cement gained 4.94 per cent to 5.31 yuan.