HK index goes south on Greece concerns
Source: Bloomberg News |
June 28, 2011, Tuesday
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Print Edition
Print Edition
HONG Kong stocks fell amid concern Greece won't meet bailout conditions and before a report in the United States that may show consumer spending growth is slowing, hurting the outlook for exporters.
HSBC Holdings Plc, Europe's biggest bank by market capitalization, declined 1.5 percent after global regulators agreed to rules that may force some of the world's biggest lenders to raise funds. China Yurun Food Group Ltd plunged 20 percent on a report surging pork prices will erode profit margins. China Eastern Airlines Corp, a Shanghai-based carrier, advanced 4.4 percent after the government said it will cut jet-fuel tariffs.
"There is the long-standing question about whether banks can capitalize or not," said Tim Leung, who helps manage about US$1.98 billion at IG Investment Ltd in Hong Kong. "With the Greece situation, the concern is that we're not close enough to a solution yet. There's a lot of concern about the strength of the US economy."
The Hang Seng Index lost 0.6 percent to 22,041.77 as of the close of trading. About two shares fell for each that gained on the 46-member gauge. The index fell more than 10 percent from a high on April 8 through June 17, surpassing the threshold that some analysts use to define a so-called correction, as China intensified efforts to fight inflation and on mounting concern Greece would default on its debt, hurting the outlook for exporters and banks.
The Hang Seng China Enterprises Index of Chinese mainland's companies' H shares yesterday climbed 0.3 percent to 12,478.61.
Financial shares exerted the biggest drag on the Hang Seng index, falling 0.7 percent, the most among the measure's four industry groups. HSBC fell 1.5 percent to HK$75.20 (US$9.66), the heaviest drag on the benchmark index.
Shares dropped ahead of a vote in Greece's parliament expected on Wednesday on a five-year austerity plan that must pass for the cash-strapped nation to secure more international aid. Stocks also fell ahead of a report expected to show growth in consumer spending is slowing in the world's biggest economy.
The US Commerce Department may say that consumer spending increased last month the least since June 2010, with outlays rising 0.1 percent, according to the median estimate of economists surveyed by Bloomberg News.
HSBC Holdings Plc, Europe's biggest bank by market capitalization, declined 1.5 percent after global regulators agreed to rules that may force some of the world's biggest lenders to raise funds. China Yurun Food Group Ltd plunged 20 percent on a report surging pork prices will erode profit margins. China Eastern Airlines Corp, a Shanghai-based carrier, advanced 4.4 percent after the government said it will cut jet-fuel tariffs.
"There is the long-standing question about whether banks can capitalize or not," said Tim Leung, who helps manage about US$1.98 billion at IG Investment Ltd in Hong Kong. "With the Greece situation, the concern is that we're not close enough to a solution yet. There's a lot of concern about the strength of the US economy."
The Hang Seng Index lost 0.6 percent to 22,041.77 as of the close of trading. About two shares fell for each that gained on the 46-member gauge. The index fell more than 10 percent from a high on April 8 through June 17, surpassing the threshold that some analysts use to define a so-called correction, as China intensified efforts to fight inflation and on mounting concern Greece would default on its debt, hurting the outlook for exporters and banks.
The Hang Seng China Enterprises Index of Chinese mainland's companies' H shares yesterday climbed 0.3 percent to 12,478.61.
Financial shares exerted the biggest drag on the Hang Seng index, falling 0.7 percent, the most among the measure's four industry groups. HSBC fell 1.5 percent to HK$75.20 (US$9.66), the heaviest drag on the benchmark index.
Shares dropped ahead of a vote in Greece's parliament expected on Wednesday on a five-year austerity plan that must pass for the cash-strapped nation to secure more international aid. Stocks also fell ahead of a report expected to show growth in consumer spending is slowing in the world's biggest economy.
The US Commerce Department may say that consumer spending increased last month the least since June 2010, with outlays rising 0.1 percent, according to the median estimate of economists surveyed by Bloomberg News.
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