Mainland railway firms dent HK stocks
Source: Bloomberg News |
March 13, 2013, Wednesday
|
Print Edition
Print Edition
HONG Kong stocks declined, led by Chinese mainland railway companies amid concern that reforms may make their markets more contestable. Every industry on the Hang Seng Composite Index, the city's broadest measure, fell.
China Railway Railway Construction Corp, one of the country's two biggest rail builders, plunged 6.5 percent. China Life Insurance Co, the nation's No. 1 seller of personal protection policies, slid 3.2 percent after clarifying comments made by its chairman over earnings. Exchange-traded funds linked to Chinese domestic equities tumbled as mainland shares retreated.
The Hang Seng Index slid 0.9 percent to 22,890.60 at the close, having earlier gained as much as 0.7 percent. About seven stocks fell for each that rose on the gauge, which has shed 3.9 percent since January 31 amid concerns about whether the pace of Chinese growth will support earnings. Volume was 11 percent less than the 30-day average.
"For the market rally to continue, it's not just about cheap valuations or accommodative policies, we actually need to see underlying performance from corporates to support the rally," said Tai Hui, Hong Kong-based chief market strategist for Asia at JPMorgan Asset Management, which has about US$2.1 trillion under management, during a Bloomberg TV interview in Hong Kong. The rally "isn't busted. It needs a bit more fundamental support, especially from an earnings perspective."
The Hang Seng China Enterprises Index, which tracks stocks of Hong Kong-listed mainland companies, fell 1.3 percent to 11,292.14. The ChinaAMC CSI 300 Index ETF, which follows shares in Shenzhen and Shanghai, lost 2 percent.
China Railway Railway Construction Corp, one of the country's two biggest rail builders, plunged 6.5 percent. China Life Insurance Co, the nation's No. 1 seller of personal protection policies, slid 3.2 percent after clarifying comments made by its chairman over earnings. Exchange-traded funds linked to Chinese domestic equities tumbled as mainland shares retreated.
The Hang Seng Index slid 0.9 percent to 22,890.60 at the close, having earlier gained as much as 0.7 percent. About seven stocks fell for each that rose on the gauge, which has shed 3.9 percent since January 31 amid concerns about whether the pace of Chinese growth will support earnings. Volume was 11 percent less than the 30-day average.
"For the market rally to continue, it's not just about cheap valuations or accommodative policies, we actually need to see underlying performance from corporates to support the rally," said Tai Hui, Hong Kong-based chief market strategist for Asia at JPMorgan Asset Management, which has about US$2.1 trillion under management, during a Bloomberg TV interview in Hong Kong. The rally "isn't busted. It needs a bit more fundamental support, especially from an earnings perspective."
The Hang Seng China Enterprises Index, which tracks stocks of Hong Kong-listed mainland companies, fell 1.3 percent to 11,292.14. The ChinaAMC CSI 300 Index ETF, which follows shares in Shenzhen and Shanghai, lost 2 percent.
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