HSBC <0005.HK> shares rose over 4 percent on Monday after its massive 12.9 billion pound ($18.9 billion) rights issue received a robust response from investors.

HSBC said 96.6 percent of shares had been taken in the offer and it was expected to sell the leftover 172.7 million shares not taken up -- or the rump -- early on Monday.

By 3:50 a.m. EDT its London-listed shares were up 4.1 percent at 452.25 pence, one of the strongest performers in a firmer European bank sector, despite the placing.

The markedly improved global investor sentiment post-G20 and the slew of strong U.S. data in recent days have helped HSBC to a great extent, said Alex Tang, research director at Core Pacific-Yamaichi International. Tang called the response to HSBC's cash call excellent.

Its Hong Kong stock was up 5.2 percent at HK$52, its highest level since it announced the cash call on March 2. The shares have soared 62 percent from the 14-year lows of HK$30.55 hit four weeks ago.

Europe's biggest bank said on Sunday that demand in Hong Kong -- where HSBC is a market darling and referred to as big elephant -- was 98.2 percent.

It was clear from the start of the process there was a lot of interest both institutionally and from the retail investors in Hong Kong so it was pretty well underpinned, said Alex Potter, analyst at Collins Stewart in London.

Potter said the bank faces more problems in the United States and conditions are likely to worsen in Asia, although the price could mark a very good entry point for long-term investors, and the rights issue will help it continue to take market share from rivals.

(Reporting by Parvathy Ullatil in Hong Kong and Steve Slater in London; Editing by Muralikumar Anantharaman and Jon Loades-Carter)

HSBC Investment