HONG KONG, July 13: Hong Kong stocks are expected to push ahead this coming week after a strong rebound on Friday lifted the blue chip Hang Seng Index to a record closing high of 15,225.29 points, analysts said.

"The Hang Seng is likely to test the intra-day high in the week ahead following a good rebound on properties and red chips last week," said said Ben Kwong, director of research at Dharmala Securities.

The blue-chip index hit an all-time high of 15,363.61 on July 3 before it quickly dipped on profit-taking.

"Investors took profit after Hong Kong's handover on July 1but selling pressure was not big during the previous weeks which indicated investors' confidence in the market," Kwong said."

The Hang Seng added 386.06 points, or 2.60 per cent, to close Friday at the day's high after rebounding from a low of 14,549 on Thursday.

Dennis Leung, research manager at J&A Securities, said the latest currency woes in the region following the devaluation of the Thai baht and the Philippine peso earlier this month could benefit the Hong Kong market.

"Hot money is seen flowing into Hong Kong due to the weakness of other markets in the region," he said.

Nikko Securities estimated a trading range of between 15,000 and 15,500 on the Hang Seng in the week ahead as sentiment improved. "The overall effect of the past week was to see a shake-out of retail punters and a regrouping around higher-quality red chips while the property sector seems to have found a bottom," the brokerage said in a research report.

But analysts said uncertainty about future government measures to rein in high real estate prices continued to cloud the market and could cap property stocks from excessive gains. Chief executive Tung Chee-hwa is expected to announce property measures in his policy speech in October.

Property counters had rebounded, utilities and banks had risen quite a lot and it would not be easy for the Hang Seng to breach 15,500, Kwong said.

"Turnover has remained relatively low. It needs to rise above HK$20 billion daily to sustain a major rally," one broker said. Overall market volume increased to HK$18.55 billion on Friday from HK$14.76 billion the previous day but it was still way below the record of HK$26.60 billion set on June 20.

Analysts said the Hang Seng was likely to take a breather after trying the new high and the market should consolidate later in the week.

Smaller banks could strengthen on hopes of becoming the targets of possible buyouts by mainland companies following news that China-backed COSCO Pacific Ltd planned to take a 20 per cent stake in Liu Chong Hing Bank Ltd.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.