<div id="readability-page-1">This article was first published on April 3, 1986. By Jerry Norton Debut-day is full of contradictions Considering the historic nature of yesterday’s share market trading, a strong rally might have seemed appropriate. Instead, the first session in the new unified stock exchange saw prices finish sharply down from Thursday’s close. But most brokers still described themselves as well satisfied with the performance, despite the Hang Seng index closing the morning-only trading session 22.67 points down at 1,603.27. Analysts generally thought it could have been much worse, considering the bearish news that came rolling in a week ago after the market finished its last pre-Easter session.  On that Thursday, another round of Government intervention to prop up a local bank was announced, trade figures for February showing a significant export decline were released, the prime rate was raised by a full percentage point, and word came of further delays in the publication of the insider trading report related to International City Holdings. With the first of those elements getting the lion’s share of the blame, Hongkong stocks were sold off in London that night to the equivalent of some 40 points on the Hang Seng index, although several later moved up from their lows. Some bullishly inclined brokers said at the time they thought the London reaction was overdone. They took the line that the Government action to aid Union Bank could be viewed as a plus, resolving uncertainty over the fate of that institution and reducing fears of a damaging bank run in the territory. Presumably, those sharing that view would have felt even more reassured after statements on Tuesday by the Financial Secretary and Banking Commissioner indicating they would continue to act in the future to minimise the possibility of either bank collapses or runs. A positive interpretation of the trade figures could also be found, arguing that a reported increase in imports largely reflected materials and components needed to meet fat orders for the future.  The prime rate rise had been widely discounted, the bulls said, and could help firm up the Hongkong dollar, diminishing selling of local shares by those concerned over its weakness against other currencies. And the insider trading report, while adding an element of uncertainty, was considered unlikely to have much general market impact. If those arguments had not convinced masses of buyers to rush into the market yesterday, at least they — and the long trading break that gave investors time to fully consider the news before acting — appeared to have put a limit on the selling. The market opened lower, but panic unloading never set in and many prices maintained the opening levels rather than moving down further. The index was off 24.27 points at 11 am, so it had actually regained a bit of ground by the finish. It had held above the 1,600 point level, which many brokers considered an important sign of long-term strength. Hutchison Whampoa’s results, announced after the close, were within expectations, but at the higher end of the range. That could also help boost sentiment, especially if Cheung Kong follows through with similar news today. Hutchison closed unchanged at $25.60 yesterday.  The suspension of trading in Eastern Asia Navigation yesterday had an unsettling effect in some quarters, but analysts were pleased when it was learned after the close that a take-out of the minorities by Sir Yue-kong Pao’s interests was behind the suspension, and that the price would be $1.45 a share. The figure was well above what they had thought might be offered in such a deal, and a hefty premium on the 94 to 96-cent closing range on Thursday. Aside from making EAN shareholders happy, the move could cause investors to ask whether certain other shares are bargains at current market prices. Another plus for the future yesterday was the simple fact that the first day of action on the new exchange had not degenerated into the near-chaos the worst pessimists had feared, or even into the considerable disorder the less cynical thought possible. Although there were problems and rough spots, as a whole things worked reasonably well, brokers said — and in turnover that was quite respectable for a half-day session, totalling $226.35 million, compared to $275 million on Thursday. Overall, brokers’ attitudes seemed to be moving back toward bullishness, despite the market’s failure to live up to expectations in the first quarter. Most leaders closed down yesterday, with Sun Hung Kai Properties joining Hutchison as an exception by holding firm, finishing at $11.10.  Action was a bit more mixed among second and third liners. Micromotor-maker Johnson Electric stood out both in terms of heavy turnover and in registering a 12.5 cent gain to close at $3.80. </div>

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<p>On April 3, 1986, Hong Kong's unified stock exchange opened for trading, but the debut session ended with the Hang Seng index down 22.67 points at 1,603.27. Despite bearish news, brokers remained satisfied with the performance, noting that panic selling did not occur. Analysts viewed government intervention to support a local bank positively, and the market's ability to hold above 1,600 points was seen as a sign of long-term strength. Overall, trading was respectable with a turnover of $226.35 million, and brokers' attitudes shifted towards bullishness despite the initial downturn.</p>

Hong Kong’s unified stock exchange opens for trading in 1986 – SCMP archive