Hong Kong stocks close down 0.46pc

PUBLISHED : Wednesday, 16 October, 2013, 5:06pm
UPDATED : Wednesday, 16 October, 2013, 8:13pm

Hong Kong stocks fell 0.46 per cent Wednesday as nervous traders hope for a deal in Washington that will reopen the US government and avert a devastating debt default.

The benchmark Hang Seng Index eased 108.19 points to finish at 23,228.33 on turnover of HK$54.16 billion (US$6.99 billion).

Global investors are focused on events on Capitol Hill as bickering US lawmakers barely have a day to agree a deal to end a shutdown that began on October 1 and increase the country’s borrowing limit.

Economists warn that failure to lift the spending ceiling will cause havoc on international markets and cause a recession worse than 2008.

However, hardliners in the Republican Party refuse to pass a budget and hike borrowing unless President Barack Obama agrees to cuts to his flagship healthcare bill.

China Resources Land fell 1.71 per cent to HK$22.95, Hang Lung Properties shed 1.55 per cent to HK$25.35 but Henderson Land rose 0.33 per cent to HK$46.30.

Chinese shares closed down 1.81 per cent. The benchmark Shanghai Composite Index fell 40.34 points to 2,193.07 on turnover of 138.2 billion yuan (HK$174.9 billion).

The index was also weighed by concerns about the possible resumption of initial public offerings, which dealers fear could cause a share glut.

China’s market regulator stopped approving initial public offers (IPOs) from late last year.

Media firms and companies linked to the newly opened Shanghai free-trade zone fell on profit-taking.

China Television Media slumped by its 10 per cent daily limit to 19.93 yuan, while Zhejiang Daily Media Group tumbled 9.84 per cent to 37.64 yuan.

Shanghai Zhangjiang High-Tech Park Development lost 9.90 per cent to 8.74 yuan and Shanghai Waigaoqiao Free Trade Zone Development lost 9.52 per cent to 46.19 yuan.