* Stiff resistance on charts seen ahead for HSI* Mainland property surge, Evergrande lead gains* Signs of bearish trend bottoming out in ShanghaiBy Clement TanSHANGHAI, Oct 13 (Reuters) - Hong Kong shares finished stronger for a sixth-straight session on Thursday, led by mainland property developers on optimism they would benefit from measures that Beijing announced on Wednesday to expand financing support for small businesses.Evergrande Real Estate Group Ltd surged 16.5 percent after it said its property sales in September jumped 79.4 percent from a year earlier, becoming the latest in a slew of Chinese developers to report strong growth in 2011 contract sales despite Beijing’s efforts to cool the property market.But not every one was so upbeat on property.Du Jinsong, Credit Suisse’s property analyst, thinks the market may have misread Beijing’s Wednesday move. On the overall Chinese property sector, the market’s view is “too optimistic, with more downside risks ahead,” he said.On Tuesday, Credit Suisse issued a report co-authored by Du which warned that an expected property price decline in China will trigger a book value write-down for listed developers, in turn leading to falls in their share-prices.Full data was not available at market close on Thursday, but short-selling has stayed consistently above 10 percent for mainland property names this week despite gains, suggesting some investors remain bearish.The Hang Seng Index closed up 2.3 percent at 18,757.8 points. It has gained more than 15 percent since hitting a 29-month low on Oct. 4. The China Enterprises Index outperformed on Thursday, jumping 3.7 percent.Mainland property developers played a big part in Thursday’s gains, with China Resources Land , which lost more than 33 percent in September, surging 12 percent, making it the second-top percentage gainer among Hang Seng components.Fears of a hard landing for the Chinese economy have hit mainland property and financial stocks hardest as longer-term investors liquidated positions and as short-selling spiked. Evergrande lost almost half of its market capitalisation in September alone.Thursday’s gains brought the Hang Seng Index to the top of a downside gap that opened up between the low of Sept. 21, at 18,698.9, and the high on Sept 22, at 18,296.8, one of several that opened up after losses topped 14 percent last month, pointing to formidable resistance ahead.Near-term resistance is next seen at the May 2010 low at about 18,971 and the 38.2 percent Fibonacci retracement of the benchmark rise from 2008 lows to its cyclical peak in 2010, at about 19,557.MATERIALS SUPPORT SHANGHAI GAINSThe Shanghai Composite Index extended its two-day winning streak, closing up 0.8 percent at 2,438.8. Materials led gains as funds trickled back into the market, pushing A-share turnover to its second-highest since Aug. 26.There were suggestions in the market that the high turnover and heavy interest in a highly growth-sensitive sector such as materials stemmed from some investors anticipating a loosening of monetary policy after more financing support were announced late on Wednesday.With the Shanghai benchmark’s 3 percent climb on Wednesday entirely enveloping Tuesday’s uptick on the charts in a down trend and in strong volume, there are strong suggestions that bearishness could be bottoming out on the Shanghai benchmark.On Thursday, Anhui Conch Cement Co Ltd rose 5.8 percent, while Aluminium Corp of China Ltd (Chalco) and Baoshan Iron & Steel Co Ltd gained 1.3 and 1.1 percent respectively.Anhui Conch lost more than 22.5 percent in September, its worst month since the 2008 financial crisis, compared with an 8 percent decline on the Shanghai Composite Index.Funds have been gradually returning to mainland markets, taking the cue from Central Huijin, the domestic investment arm of the country’s sovereign wealth fund, which was reported on Monday to be raising its stakes in the “Big Four” Chinese banks over the next 12 months.Several analysts said investors saw Huijin’s move not only as an affirmation of the value of banking stocks but also a boost to sentiment, showing the government would provide hefty support to the market.

* Stiff resistance on charts seen ahead for HSI* Mainland property surge, Evergrande lead gains* Signs of bearish trend bottoming out in ShanghaiBy Clement TanSHANGHAI, Oct 13 (Reuters) - Hong Kong shares finished stronger for a sixth-straight session on Thursday, led by mainland property developers on optimism they would benefit from measures that Beijing announced on Wednesday to expand financing support for small businesses.Evergrande Real Estate Group Ltd surged 16.5 percent after it said its property sales in September jumped 79.4 percent from a year earlier, becoming the latest in a slew of Chinese developers to report strong growth in 2011 contract sales despite Beijing’s efforts to cool the property market.But not every one was so upbeat on property.Du Jinsong, Credit Suisse’s property analyst, thinks the market may have misread Beijing’s Wednesday move. On the overall Chinese property sector, the market’s view is “too optimistic, with more downside risks ahead,” he said.On Tuesday, Credit Suisse issued a report co-authored by Du which warned that an expected property price decline in China will trigger a book value write-down for listed developers, in turn leading to falls in their share-prices.Full data was not available at market close on Thursday, but short-selling has stayed consistently above 10 percent for mainland property names this week despite gains, suggesting some investors remain bearish.The Hang Seng Index closed up 2.3 percent at 18,757.8 points. It has gained more than 15 percent since hitting a 29-month low on Oct. 4. The China Enterprises Index outperformed on Thursday, jumping 3.7 percent.Mainland property developers played a big part in Thursday’s gains, with China Resources Land , which lost more than 33 percent in September, surging 12 percent, making it the second-top percentage gainer among Hang Seng components.Fears of a hard landing for the Chinese economy have hit mainland property and financial stocks hardest as longer-term investors liquidated positions and as short-selling spiked. Evergrande lost almost half of its market capitalisation in September alone.Thursday’s gains brought the Hang Seng Index to the top of a downside gap that opened up between the low of Sept. 21, at 18,698.9, and the high on Sept 22, at 18,296.8, one of several that opened up after losses topped 14 percent last month, pointing to formidable resistance ahead.Near-term resistance is next seen at the May 2010 low at about 18,971 and the 38.2 percent Fibonacci retracement of the benchmark rise from 2008 lows to its cyclical peak in 2010, at about 19,557.MATERIALS SUPPORT SHANGHAI GAINSThe Shanghai Composite Index extended its two-day winning streak, closing up 0.8 percent at 2,438.8. Materials led gains as funds trickled back into the market, pushing A-share turnover to its second-highest since Aug. 26.There were suggestions in the market that the high turnover and heavy interest in a highly growth-sensitive sector such as materials stemmed from some investors anticipating a loosening of monetary policy after more financing support were announced late on Wednesday.With the Shanghai benchmark’s 3 percent climb on Wednesday entirely enveloping Tuesday’s uptick on the charts in a down trend and in strong volume, there are strong suggestions that bearishness could be bottoming out on the Shanghai benchmark.On Thursday, Anhui Conch Cement Co Ltd rose 5.8 percent, while Aluminium Corp of China Ltd (Chalco) and Baoshan Iron & Steel Co Ltd gained 1.3 and 1.1 percent respectively.Anhui Conch lost more than 22.5 percent in September, its worst month since the 2008 financial crisis, compared with an 8 percent decline on the Shanghai Composite Index.Funds have been gradually returning to mainland markets, taking the cue from Central Huijin, the domestic investment arm of the country’s sovereign wealth fund, which was reported on Monday to be raising its stakes in the “Big Four” Chinese banks over the next 12 months.Several analysts said investors saw Huijin’s move not only as an affirmation of the value of banking stocks but also a boost to sentiment, showing the government would provide hefty support to the market.