TNAG-0566-FCO40-699-Implications-for-Hong-Kong-of-change-in-Chinese-leadership-1976 — Page 6

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MING PAO EVENING NEWS said it would be in Hong Kong's best interests if the moderates gained power in China.

"What we should really worry about is a situation where the power struggle is deadlocked, leading to internal conflicts, with the Soviet Union waiting for a chance to invade China," the paper said.

NAM WAH MAN PAO said people who were over-sensitive about the situation in China could easily be manipulated by speculators on the stock market.

The paper said that judging from the current trend on the market there would be a boom in the near future which would push the Hang Seng Index to the 500 mark.

The HONG KONG ECONOMIC JOURNAL said the panic reaction of stockholders to reports of changes in China had killed all hopes of a boom in the stock market.

The paper felt that on the basis of a sound economic outlook for Hong Kong and changes in China which could be seen to benefit Hong Kong, there was no reason why the stock market index did not climb.

it said.

"It will be relatively easy for the market index to climb another 20 to 30 points,"

SOUNDS OF ARTILLERY FIRE

Sounds of artillery fire and gunshots were reportedly heard on the night of October 13 and the following morning across the border on Chinese territory.

The HONG KONG DAILY NEWS (October 15) said many people were concerned about the report, and hoped that it was just a routine military exercise.

It noted that passenger traffic between Canton and Hong Kong had been normal, indicating that there was nothing unusual in the situation along the border.

TIN TIN YAT PO (October 13 & 15) said the British Army had stepped up its patrols along the border, but the paper felt that any fighting in China would probably not affect Hong Kong.

It felt that the failure of Chiang Ching's coup had no effect whatsoever on Hong Kong.

TIN TIN said that reports of the moderates gaining power in China were a headache for certain overseas leftist elements, including those in Hong Kong, who had claimed to be supporters of the radicals (although the radicals had never admitted to their existence.)