HK Stocks Poised to Enter Correction as Insurers Retreat

23-Dec-2016 Intellasia | Bloomberg | 6:00 AM Print This Post

Hong Kong stocks fell, with the benchmark index poised to enter a correction, as energy producers and financial companies retreated amid dwindling The Hang Seng Index slid 0.7 percent as of 2:11 p.m. local time. The gauge has slumped more than 10 percent since its September 9 high as rising funding costs in Hong Kong and the mainland weighed on property developers and a weakening yuan turned investors off Chinese assets. The value of shares traded on the city’s stock market dropped to a four-month low on Wednesday before the start of holidays at the end of the week. The Shanghai Composite Index slipped 0.2 percent.

“The selloff today reflects investors’ lack of confidence in the short-term performance of the China stock market,” said Kenny Wen, a wealth management strategist at Sun Hung Kai Financial Ltd in Hong Kong. “Volume is thin, not just due to the holiday season, but also because investors think there will be further downside in Hong Kong stocks and they are choosing to stay on the sidelines.”

Chinese equity gauges are among the world’s biggest losers this month as surging money-market rates sparked turmoil in the nation’s bond market, while the weakening currency increased pressure on capital outflows. That’s capping a dismal year for mainland stock investors, with the Shanghai benchmark set for its biggest annual decline since 2011.

The Hang Seng Index has declined 5 percent in December and lost 7.1 percent in the fourth quarter, while it’s down 1.2 percent this year

China Shenhua Energy Co. fell the most on the Hang Seng Index on Thursday. Cnooc Ltd and PetroChina Co. dropped at least 1.2 percent as the oil industry faces an inventory overhang

Ping An Insurance Group Co. retreated 1.9 percent in Hong Kong to lead a group of financial companies lower. Industrial & Commercial Bank of China Ltd slipped 1.5 percent to its lowest price in a month

Shanghai’s benchmark gauge has fallen 3.6 percent in December, paring its gains for the quarter to 4.3 percent. The index is down 11 percent in 2016, set for its biggest loss in five years

Qingdao Huijintong Power Equipment Co. rose 44 percent in its trading debut in Shanghai

The Shanghai Composite will climb to 3,800 by the end of next year, according to the median forecast in a Bloomberg poll of 12 strategists and fund managers, implying a 21 percent gain from Wednesday’s closeturnover.

https://www.bloomberg.com/news/articles/2016-12-22/hong-kong-stocks-poised-to-enter-correction-as-insurers-retreat

 


Category: Hong Kong

Print This Post

Comments are closed.