Earlier in the session, trading on the index was halted for about half an hour at the start and a Hang Seng Indexes spokesman said the problem was being investigated. Market turnover soared to HK$104.16 billion ($13.40 billion), the highest level since November 27, from Thursday's HK$83.13 billion.
The China Enterprises Index of top locally listed mainland Chinese stocks closed up 0.15 percent at 11,975.65. Dealers cautioned against excessive optimism, saying the rebound may not last as fears of tighter monetary policy in China persisted. China Construction Bank (CCB) was up 1.31 percent at HK$6.20. Bank of China rose 0.52 percent to HK$3.89. Industrial and Commercial Bank of China gained 2.27 percent to HK$5.85.
For the week, the Hang Seng index was down 4.3 percent, its worst weekly performance since November 2009, on worries that China's reining in of bank lending could damp economic growth. HSBC closed down 1.55 percent at HK$85.70, while Standard Chartered retreated 4.55 percent to HK$182.40, tracking losses in their London-listed shares, on news that US President Barack Obama had threatened to fight Wall Street banks on Thursday with a proposal to limit financial risk taking.
Dominic Chan, banking analyst with BNP Paribas, said their decline was just a knee-jerk reaction to the news. "HSBC has been outperforming the market in the past few days. It's only down 2 percent today. I wouldn't read too much into it. It's just a market correction," Chan said. "HSBC and StanChart have been focused on the traditional banking business. I don't think proprietary trading accounts for a bulk of their earnings."
Energy-related stocks tumbled in heavy trade after oil prices topped $76 on Friday, up a few cents from one-month lows. Oil producer PetroChina was down 0.11 percent at HK$9.17. Peer CNOOC shed 2.36 percent to HK$11.56, and Sinopec lost 1.25 percent to HK$6.34.
Denway Motors bucked the overall weakness, rising 7.58 percent to HK$4.97, after the company said its controlling parent Guangzhou Automobile Group, a Chinese partner of Honda and Toyota, was planning a back-door listing in Hong Kong through its Denway Motors unit.
SHANGHAI PARES LOSSES China's key stock index fell 0.96 percent, with banking stocks very active as bargain-hunting late in the session lifted the index smartly from a one-month intraday low, hit after the announcement of a large initial public offering and several smaller ones.
The Shanghai Composite Index ended at 3,128.588, after having fallen more than 3 percent intraday. Most actively traded Industrial and Commercial Bank of China closed up 1.2 percent at 5.08 yuan after earlier dropping 1.39 percent. The index, which lost 3 percent this week in its biggest weekly fall in five weeks, appeared to have found support at the 125-day moving average at 3,116 points, which it briefly breached during intraday trade.
On Friday, China First Heavy Industries said it would launch an IPO next week for a listing on the Shanghai Stock Exchange to raise funds, including 8.4 billion yuan ($1.23 billion) for manufacturing projects and working capital. Nine banks were the day's most-active stocks, with Construction Bank of China ending up 2.21 percent at 6.02 yuan and Minsheng Bank rising 1.97 percent to 7.78 yuan.