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HK shares dip on Europe's debt problems
Source: Bloomberg News |
September 27, 2011, Tuesday
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Print Edition
Print Edition
HONG Kong's Hang Seng Index fell to its lowest close in more than two years yesterday as Europe-related shares declined on concern the region won't resolve its debt crisis while property developers also slid.
Esprit Holdings Ltd, the clothier that gets most of its revenue from Europe, slid 3.7 percent. Henderson Land Development Co, the Hong Kong developer controlled by billionaire Lee Shau-kee, tumbled 6.1 percent after the city's weekend used- home transactions fell. Jiangxi Copper Co, China's largest producer of the metal, sank 9.3 percent after commodity prices slid. China Yurun Food Group Ltd, a meat processor, tumbled 31 percent after saying it expects third-quarter profit to decline.
The key Hang Seng Index fell 1.5 percent to 17,407.80, its lowest close since July 2009. The Hang Seng China Enterprises Index of Chinese mainland companies listed in Hong Kong shed 3.3 percent to 8,735.40.
"The world economy is going down the path of long slowdown and recession," said Francis Lun, managing director at Lyncean Holdings Ltd, an investment holding company in Hong Kong. "It's continuing bad news for the market. Investors should be cautious and should not rush in to buy anything yet."
The key index tumbled 9.2 percent last week on concern policy makers are running out of tools to avert recession as Europe's debt crisis worsens and economic growth in the United States slows. Shares on the index traded at 9.3 times forecast earnings, versus 11.4 times for the Standard & Poor's 500 Index.
Futures on the S&P's 500 Index swung between gains and losses yesterday. In New York, it pared losses to 6.5 percent last week amid speculation that policymakers will act to prevent a global financial crisis from getting worse.
Esprit declined 3.7 percent to HK$7.93 (US$1.02). Hutchison Whampoa Ltd, which owns ports in Germany and Spain and get over half of its revenue from Europe, sank 3.8 percent to HK$59.80.
Esprit Holdings Ltd, the clothier that gets most of its revenue from Europe, slid 3.7 percent. Henderson Land Development Co, the Hong Kong developer controlled by billionaire Lee Shau-kee, tumbled 6.1 percent after the city's weekend used- home transactions fell. Jiangxi Copper Co, China's largest producer of the metal, sank 9.3 percent after commodity prices slid. China Yurun Food Group Ltd, a meat processor, tumbled 31 percent after saying it expects third-quarter profit to decline.
The key Hang Seng Index fell 1.5 percent to 17,407.80, its lowest close since July 2009. The Hang Seng China Enterprises Index of Chinese mainland companies listed in Hong Kong shed 3.3 percent to 8,735.40.
"The world economy is going down the path of long slowdown and recession," said Francis Lun, managing director at Lyncean Holdings Ltd, an investment holding company in Hong Kong. "It's continuing bad news for the market. Investors should be cautious and should not rush in to buy anything yet."
The key index tumbled 9.2 percent last week on concern policy makers are running out of tools to avert recession as Europe's debt crisis worsens and economic growth in the United States slows. Shares on the index traded at 9.3 times forecast earnings, versus 11.4 times for the Standard & Poor's 500 Index.
Futures on the S&P's 500 Index swung between gains and losses yesterday. In New York, it pared losses to 6.5 percent last week amid speculation that policymakers will act to prevent a global financial crisis from getting worse.
Esprit declined 3.7 percent to HK$7.93 (US$1.02). Hutchison Whampoa Ltd, which owns ports in Germany and Spain and get over half of its revenue from Europe, sank 3.8 percent to HK$59.80.
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