Hong Kong stocks close down 0.33pc

PUBLISHED : Friday, 04 October, 2013, 2:12pm
UPDATED : Friday, 04 October, 2013, 8:54pm

Hong Kong stocks closed 0.33 per cent lower on Friday as investors grew concerned that a stand-off in Washington over the US budget could lead to a government debt default.

The benchmark Hang Seng Index slipped 75.86 points to 23,138.54 on turnover of HK$54.56 billion (HK$7.04 billion).

The US government remained mostly closed for the third straight day Thursday as a result of the budget stand-off. Concerns over the shutdown sent US stocks down across the board, with the Dow Jones closing below 15,000 for the first time in a month.

The risk of a more protracted and damaging outcome is increasing
 BNP Paribas economists

It comes just weeks before a pivotal deadline to raise the US borrowing limit, a measure which must also be approved by lawmakers.

“The risk of a more protracted and damaging outcome is increasing,” said BNP Paribas global economists in a note to clients, according to Dow Jones Newswires.

In Hong Kong the index was also dragged down by a slump in heavily-weighted China Mobile, with mainland reports of possible cuts in carrier fees sending the stock down 2.9 per cent Friday.

That accounted for more than 60 per cent of losses on the index.

However analysts at Citibank cast doubt on the reports, writing in a note to clients that they believe the reported fee change is “just one preliminary plan” among regulators while suggesting “no change” is still likely, according to Dow Jones.

The Shanghai market was closed for a public holiday.