LAST week's sale by CITIC Hong Kong of 60.1 million shares of Hongkong Telecom for about $950 million - not long after Cheung Kong (Holdings) sold 37.8m shares of Hutchison for $1.5 billion - is the latest example of local investors selling holdings in companies here.
The trend has gained momentum over the past two months, not only as evidenced from selling by corporates such as CITIC and Cheung Kong, but from selling among corporate directors of Hang Seng Index (HSI) constituents, a slowdown in company buyback activity, and domestic redemptions of Hong Kong equity funds.
During May, dealing by directors of HSI constituent companies reached its highest net sell level since September, with directors selling $167 million worth of stock while acquisitions were $73.5 million.
Directors sold more shares than they bought in April, with disposals outpacing acquisitions by $15 million. Of the 16 HSI constituents that saw director dealing in May, 13 experienced selling, while seven saw buying at prevailing market prices.
Directors at Hang Lung Development bought $30 million, Hong Kong and China Gas directors bought $21 million, and Great Eagle saw directors buy $1.4m.
Company buyback activity has tapered off in terms of the number of companies buying back their shares and the total value of funds committed for share repurchases.
