 HSI hits two-year low amid global downturn
By Joey Kwok (HK Edition)
Updated: 2008-10-07 07:01
Hong Kong shares sank below 17,000 points for the first time in more than two years yesterday, dragged by the slump of mainland stocks and the credit crisis in Europe weighing down the global financial market. The benchmark Hang Seng Index (HSI) slid 4.97 percent, or 878.64 points, to ease at 16,803.76, its lowest closing level since July 2006. Mainboard turnover was just HK$47.3 billion. Patrick Yiu, associate director of CASH Asset Management, said that Hong Kong stocks have been following the trend of the global economic situation, and the recent sluggish markets in the US and Europe are taking their toll on the overall performance of Hong Kong shares. "The economic situation and property market in Hong Kong are quite bad now, therefore the stocks do not perform well," Yiu said. When asked about the performance of Hong Kong stocks after today's holiday, Yiu said that if markets in the US and Europe continue to fall, Hong Kong shares may encounter a further drop when the market reopens on Wednesday. "Hong Kong stocks are being quite passive now," Yiu said, adding that global investors are keeping an eye on the market developments in Europe, which has been hurt by its recent credit crisis. Tung Tai Securities Associate Director Kenny Tang said he expects Hong Kong shares to continue fluctuating this week. "The HSI may move around 16,200 to 17,500 this week," Tang said, noting that the market turnover stayed quite low before the market closed for the public holiday. Bourse operator Hong Kong Exchanges and Clearing fell 6.32 percent yesterday, to HK$6, closing at HK$89. China Mobile, the world's largest wireless carrier, shed 5.84 percent, or HK$4.50, to close at HK$72.60. Index heavyweight HSBC Holdings dropped 2.19 percent, or HK$2.70, to finish at HK$120.50. Meanwhile, mainland stocks also slumped after the National Day "Golden Week" holidays. The China Enterprises Index of Hong Kong-listed mainland companies (H-shares) dropped 6.62 percent to 8,416.90. China Overseas Land Investment, giving up its rally last week on the growth-favorable policies, declined by 11.76 percent or HK$1.20 yesterday to HK$9. Top lender ICBC fell 5.28 percent, or HK$0.23, to close at HK$4.13, while the second-largest lender, China Construction Bank, slid 7.29 percent, or HK$0.25, ending at HK$4.45. Mainland resource stocks also slipped, after the falling prices of commodities. Gold miner Zijin Mining dropped 13.3 percent, while China Coal Energy slumped 12.9 percent. (HK Edition 10/07/2008 page3) |
