HK shares jump 3 pct as credit crisis fears ebb

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By Joseph Chaney

HONG KONG, April 2 (Reuters) - Hong Kong stocks hit a
one-month closing high on Wednesday after strong demand for a
Lehman Brothers LEH.N share offering raised hopes that the
worst of the credit crisis may have ended.

Stocks rose across the board, tracking robust Asian markets,
and led by financial and property shares.

"The rally should be sustained in the medium term because of
recent signs that the U.S. markets are stabilising," said Ernie
Hon, an analyst at ICEA Securities.

"We are optimistic about mainland banks, and also individual
stocks that have been oversold."

The benchmark Hang Seng Index .HSI leapt as much as 4.6
percent in morning trade, but retreated on profit-taking to end
3.18 percent higher at 23,872.43 points, buoyed by property and
financial plays.

Heavyweight HSBC (0005.HK) gained nearly 2 percent, lifting
the market over 70 points.

The China Enterprises Index of Hong Kong-listed mainland
companies .HSCE, or H shares, closed up 4.66 percent at
12,807.35.

Investors crammed into the rally, sending mainboard turnover
up to HK$114.7 billion ($14.73 billion) compared with HK$78.03
billion on Tuesday.

Some analysts warned, however, that profit-taking loomed.

"Obviously the sentiment has been improving," said Y.K. Chan,
a strategist at Phillip Securities. "But we are still cautious
that the A share market in China will impact Hong Kong."

Earlier in the week, Hong Kong stocks ended their worst
quarterly performance in six years, with the benchmark Hang Seng
Index sliding 18 percent during the period.

China's main stock index in Shanghai .SSEC came sharply off
the day's highs on Wednesday, lagging foreign markets because of
concern about slowing economic growth and huge supplies of fresh
equity. It surged as much as 4.07 percent but retreated in the
late afternoon to finish just 0.56 percent higher.

In Hong Kong, heavyweight China Mobile (0941.HK) closed up
3.4 percent at HK$121.70, lifting the index over 104 points.

Financial plays also soared.

China's second-largest life insurer, Ping An (2318.HK) --
coming off lows after announcing its multibillion-dollar
fundraising plan in January -- jumped nearly 5.6 percent to
HK$58.70.

ICBC (1398.HK) leapt 4.9 percent to HK$5.81, Bank of China
(3988.HK) jumped 3.8 percent to HK$3.53 and Bank of
Communications (3328.HK) soared 6.5 percent to HK$9.86.

Swiss bank UBS (UBSN.VX) rattled investors on Tuesday with
news of $19 billion in fresh writedowns [ID:nL01419180] but
markets took the view that banks are wiping their books clean of
investments tied to the U.S. subprime crisis.

Property stocks rose further as investors looked for bargains
after recent lows.

Sun Hung Kai Properties (0016.HK), Asia's top developer by
market value, jumped 4.6 percent to HK$129.50.

Developer Sino Land (0083.HK) rallied 8.5 percent to HK$18.20.
Hang Lung (0101.HK) gained 5.9 percent to HK$29.55, and New World
Development (0017.HK) climbed 5.4 percent to HK$19.82.

Refiners and airlines also leapt as oil prices stayed off
highs. Sinopec Corp (0386.HK) (600028.SS), Asia's top refiner,
soared 6.3 percent to HK$7.25.

Hong Kong's dominant carrier Cathay Pacific (0293.HK) gained
4.6 percent to HK$16.32, while Air China (0753.HK) climbed 2.8
percent to HK$7.02.

And cruise operator Star Cruises (0678.HK) SARC.SI leapt 7.7
percent to HK$1.67 after it agreed to join forces with Alliance
Global Group Inc (AGI.PS) to develop and operate hotel and casino
complexes in the Philippines.

($1=7.787 Hong Kong Dollar)
(Reporting by Joseph Chaney; Editing by Anne Marie Roantree)