Hong Kong stocks retreat from 15-month high
Hong Kong shares fell on Monday as investors locked in profit after the city’s benchmark hit a 15-month high and ahead of Tuesday’s US presidential election.
The benchmark Hang Seng Index shed 104.93 points, or 0.47 per cent, to finish at 22,006.40. Turnover fell from Friday’s HK$70 billion to HK$51.7 billion.
Funds fled financial stocks after Chinese banks, which had rallied for weeks, after their third-quarter earnings beat forecasts. HSBC (0005.HK) lost 0.3 per cent to finish at HK$77.75 ahead of its third-quarter earnings due later in the day.
“There has been a liquidity driven rally over the past months, but we are still looking at company earnings very closely to see if they live up to expectations,” said Franki Chung, chief investment officer at MEAG HK, when asked whether he saw the incoming capital boosting the city’s equity prices further.
Local property players, which were dumped last Monday following the city’s fresh demand-side curbs, recovered earlier losses. Sun Hung Kai Properties (0016.HK) went up 0.45 per cent to finish at HK$110.60.
Zhejiang Shibao Company (1057.HK), lost 7.84 per cent to finish at HK$2.47 in Hong Kong and 10 per cent in Shenzhen to finish at HK$16.88. The stock surged by more than six times on it’s A-share debut last Friday, the biggest single-day advance by a company in its first day of public trading on mainland bourses in more than a decade.
Foxconn International Holdings (2038.HK), the world’s biggest contract maker of cellphones, surged as much as 31.9 per cent to finish at HK$3.6, following rating upgrades by HSBC and Citigroup.
“With internet and software companies getting into the smartphone space, FIH now has a golden opportunity to resume growth. We note that Amazon, Google, Microsoft, Xiaomi, Baidu, Tencent are all trying to launch smartphones and none has in-house manufacturing,” Citi analyst Kevin Chang wrote in an morning note to a client.