HSBC Holdings Plc, Hong Kong's largest bank, also said it would leave its prime lending rate in Hong Kong unchanged despite a rate hike in the United States overnight.
"HSBC's decision not to raise the prime rate is not a surprise at all. There is no immediate pressure on large banks to raise rates, since the liquidity situation in Hong Kong is still quite favourable at the moment," said Ben Kwong, associate director at KGI Asia Ltd.
The blue chip Hang Seng Index ended down 0.3 percent, or 40.47 points at 13,515.33. Turnover, at just under HK $16 billion ($2 billion), was lighter than HK $17.7 billion at Wednesday's close. Volumes are expected to decline further ahead of the holiday period.
The Bank of East Asia (BEA) also kicked off Hong Kong's earnings season early in the afternoon with better-than-expected full-year results. Its stock rose 0.65 percent to HK $23.10.
Shares of China Unicom jumped 3.28 percent to HK $6.30, while China Telecom rose 0.85 percent to HK $2.95 and China Netcom rose 1.32 percent to HK $11.50 on news of China Telecom's proposals.
CNOOC Ltd was the top blue chip loser, falling 4.85 percent to HK $3.925 a day after the Chinese oil and gas producer revised down its production targets for the coming years, prompting Lehman Brothers to trim its 2005 earnings forecast for the company by more than 7 percent to 17.1 billion yuan (US $2 billion) and its 2006 earnings forecast by 3 percent to 14.4 billion yuan.
Electricity producer Huadian Power crackled on its Shanghai debut, with the shares ending up 78.97 percent at 4.51 yuan. However, analysts said the rise was not justified by fundamentals. Its HK-listed stock ended up 2.13 percent at HK $2.40.
China's top computer maker, Lenovo Group Ltd, fell 1.19 percent to HK $2.075 ahead of its third-quarter results on Friday. Lenovo, which is planning to buy IBM's PC business, is expected to report profits stagnated in the quarter amid growing competition and a slowdown in market growth.
Shares in Universal Holdings Ltd surged 112.77 percent to HK $0.10 after the company agreed to buy 50 percent of Chinese movie investor Asian Union Film and Media for HK $550 million.