HONG KONG _ Hong Kong shares rose to a record high Wednesday for the second straight session on rotational buying in laggards.

The blue chip Hang Seng Index rose 103.21 points, or 0.5 percent, to close at 20,413.39.

Analysts said the benchmark index is unlikely to rise significantly further in near term with strong profit-taking activities.

"The market is actually overbought, but liquidity is abundant," said Ben Kwong, associate director of KGI Asia Ltd.

Dao Heng Securities Ltd. says "a technical correction in the stock market is very likely, probably after the listing of China Life Insurance A-share listing next Tuesday" but said it is positive in medium-to-long term on Hong Kong stock market.

Blue chips that had underperformed last year caught up.

CKI Holdings, the worst-performing blue chip in 2006, rose 5 percent to HK$25.05. COSCO Pacific rose 4 percent to HK$19.32.

Bucking the trend, shares of China urban gas distributors fall as Guangdong plans to cancel one-off connection fee likely to hurt their earnings.

Xinao Gas, which has four projects in Guangdong, down 7.6 percent at HK$7.92. HK & China Gas, which has six projects in the province, dropped 0.6 percent while Panva Gas, which has 3 projects there, slipped 3.3 percent.