The benchmark Hang Seng Index dropped just 0.2 percent yesterday after a roller-coaster ride that saw it shoot up 650 points at one stage.

The index finally fell 61 points to close at 27770, after investors profited on gains in the morning. The day's turnover was HK$154 billion.

The China Enterprises Index, which gauges the performance of mainland companies, soared 28.2 points to 17511.

"The Golden Week effect has faded away," said Ricky Cheung, executive and vice-president of Enlighten Securities and Futures. "The index might go into a correction period in October of up to 3000 points."

HSBC peaked at HK$153 in the morning session, but dropped in the afternoon to close at HK$149.8.

China Mobile also fell HK$1.3, or 1 percent, finishing at HK$128.6.

Although market watchers said China Life has been overbought, its turnover remained active, with shares worth HK$7.8 billion changing hands.

Shares of the Hong Kong Exchange and Clearing (HKEx) rose sharply, with the stimulus of the government raising its holdings of the bourse.

HKEx yesterday hit an all-time high of HK$254 in the opening session. Although some investors began to downsize their holdings after booking profits, the share increased 1.4 percent to settle at HK$247.6.

The mainland's giant lenders outperformed their peers. China Merchants Bank leapt by over 5 percent shortly after its shares opened for trading. It closed at HK$10.02, increasing 2.94 percent.

CASH Asset Management Associate Director Patrick Yiu said the market is in temporary consolidation. After this, "we will see the index climb to new highs at the end of the year".

Patrick Shum, chief portfolio strategist of Karl Thomson Securities, said the index would linger around 28500 in the short run.

(China Daily October 9, 2007)