Hong Kong stocks fell modestly on Friday as investors reined in their strength ahead of annual results reports by major blue-chip companies next week.

The benchmark Hang Seng Index recovered 35.05 points, or 0.27 percent, to open at 12,929.99 and once rallied as much as 137.36 points, or 1.06 percent, to the day's highest 13,032.3 in the morning session.

Support above the key 13,000 mark was short-lived as performance of bourses in the Chinese mainland, the United States and Europe remained weak.

The index changed directions for seven times in the back-and-forth trading and slipped 83.37 points, or 0.65 percent, to close at 12,811.57 after trading between intra-day high 13,032.3 and intra-day low 12,799.81.

Turnover dipped to 38.04 billion HK dollars (4.91 billion U.S. dollars) from Thursday's 39.49 billion HK dollars (5.1 billion U.S. dollars)

Among 42 components of the Hang Seng Index, declining shares led advancing issues by 31 to 11. The market's major player HSBC, which accounts for the largest weighting of the index, skid 0.87 percent to 56.95 HK dollars amid speculation of fund-raising to boost its capital adequacy ratio. HSBC will unveil its annual results on Monday.

Another market heavyweight China Mobile, the market's largest stock by capitalization and the country's largest mobile phone operator, dipped 0.73 percent to 68 HK dollars.

Hong Kong Exchange and Clearing Ltd., the market's sole operator, outperformed the entire market by adding 0.56 percent to 62.55 HK dollars.

Hong Kong's local property companies were mixed. Sun Hung Kai Property shrank 0.49 percent to 61 HK dollars. Cheung Kong, one of Hong Kong largest house developers controlled by tycoon Li Ka-shing, fell 1.31 percent to 63.85 HK dollars. Hutchison, another conglomerate controlled by Li Ka-shing, edged down 0.12 percent to 41 HK dollars. Sino Land was down 0.16 percent to 6.09 HK dollars.

Henderson Land outpaced the entire market by gaining 0.96 percent to 26.2 HK dollars. New World Development went up 0.71 percent to 7.05 HK dollars. Hang Lung gained 1.63 percent to 14.98 HK dollars.

China Enterprise Index or H-shares, which reflect the performance of 42 companies registered on the Chinese mainland listed in Hong Kong, shed 92.57 points, or 1.32 percent, to close at 6,902.84 as stock markets in the Chinese mainland moved downward for two consecutive sessions.

Chinese banks and insurers were heading different directions. ICBC, China's largest lender, weakened 2.15 percent to 3.18 HK dollars. Bank of Communications lost 1.67 percent to 4.71 HK dollars. China Merchants Bank dropped 1.54 percent to 11.5 HK dollars.

China Life, the country's largest insurer, moved down 2.46 percent to 21.8 HK dollars. Ping An, China's second largest insurance company behind China Life, lost 1.84 percent to 37.3 HK dollars.

Bank of China, the country's second largest bank, outshone the entire market by rising 2.36 percent to 2.17 HK dollars. China Construction Bank gained 1.28 percent to 3.95 HK dollars.

Energy companies all fell as global economic outlook continued to gloomed demands. PetroChina, the country's largest oil producer, dropped 1.25 percent to 5.53 HK dollars. Sinopec, Asia's largest oil refiner, dipped 0.98 percent to 4.05 HK dollars. CNOOC, China's largest offshore oil company, was unchanged at 6.8 HK dollars. (7.75 HK dollars =1 U.S. dollar)

(Xinhua News Agency February 27, 2009)