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HK shares close at lowest in 2 years
Source: Bloomberg News |
September 22, 2011, Thursday
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Print Edition
Print Edition
HONG Kong stocks fell yesterday, dragging the Hang Seng Index to its lowest close in two years, after the International Monetary Fund cut its global economic growth forecast and predicted "severe" repercussions if Europe fails to contain its sovereign-debt crisis.
Techtronic Industries Co, maker of Ryobi power tools and Hoover vacuum cleaners that counts North America as its largest market, slipped 1.8 percent. Esprit Holdings Ltd, the Hong Kong-based clothier that gets 83 percent of its sales from Europe, slumped 11 percent. Jiangxi Copper Co, China's biggest producer of the metal, sank 4.5 percent after the IMF predicted commodity prices will fall.
"People just have to resign themselves to the fact that we are going to see a recession," said Hong Kong-based Pauline Dan, chief investment officer at Samsung Asset Management, which oversees US$72 billion. "There's a lot of talk about further quantitative easing by the Fed. That will help buy time, but it's not going to be the solution."
The Hang Seng Index fell 1 percent to 18,824.17 at the close, the lowest since July 2009. About four stocks dropped for each that rose in the 46-member gauge, which deepened losses after European markets opened lower. The Hang Seng China Enterprises Index of Chinese companies listed in Hong Kong slid 0.9 percent to 9,822.67, having swung between gains and losses at least eight times.
The Hang Seng Index is poised for an 8.3 percent decline this month, driven down by concern Europe's debt crisis is spreading and on signs the United States economic recovery is stalling.
The world economy will expand 4 percent this year and next, the IMF said, against a June forecasts of 4.3 percent in 2011 and of 4.5 percent in 2012. The US growth projection for 2011 was cut to 1.5 percent from 2.5 percent.
Techtronic Industries Co, maker of Ryobi power tools and Hoover vacuum cleaners that counts North America as its largest market, slipped 1.8 percent. Esprit Holdings Ltd, the Hong Kong-based clothier that gets 83 percent of its sales from Europe, slumped 11 percent. Jiangxi Copper Co, China's biggest producer of the metal, sank 4.5 percent after the IMF predicted commodity prices will fall.
"People just have to resign themselves to the fact that we are going to see a recession," said Hong Kong-based Pauline Dan, chief investment officer at Samsung Asset Management, which oversees US$72 billion. "There's a lot of talk about further quantitative easing by the Fed. That will help buy time, but it's not going to be the solution."
The Hang Seng Index fell 1 percent to 18,824.17 at the close, the lowest since July 2009. About four stocks dropped for each that rose in the 46-member gauge, which deepened losses after European markets opened lower. The Hang Seng China Enterprises Index of Chinese companies listed in Hong Kong slid 0.9 percent to 9,822.67, having swung between gains and losses at least eight times.
The Hang Seng Index is poised for an 8.3 percent decline this month, driven down by concern Europe's debt crisis is spreading and on signs the United States economic recovery is stalling.
The world economy will expand 4 percent this year and next, the IMF said, against a June forecasts of 4.3 percent in 2011 and of 4.5 percent in 2012. The US growth projection for 2011 was cut to 1.5 percent from 2.5 percent.
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