Especially ahead of the National People Congress [beginning November 7] with power structure changes -- who's in, who's out and what scores are being settled -- some of the recent scandals have raised the question: whether someone is being prosecuted because it was a sign of a loss of some power or potential loss of power by a particular faction in the government?
It's good to see CLP making a one-off gain last year and investors are happy to see that its earnings from overseas operations are increasing. However, it faces problems ahead as the government looks to change the scheme of controls which apply to local power companies.
Yesterday's announcement by the Hong Kong Mortgage Corporation that the government would provide a top-up guarantee on mortgages was good for the market. But we are still a bit cautious. It was very light turnover and there was no real selling pressure.
The index's performance has been quite disappointing the last couple of days. I see no reason for the market to soften. There is quite a lot of money around which should support the market going forward.