The Hang Seng Index suffered its biggest one-day fall in five months as futures sellers used revived worries about higher interest rates and HSBC shares going ex-dividend to drag down the Hong Kong market yesterday.
A larger-than-expected jump in the February core producer price index in the United States, and Federal Reserve chairman Ben Bernanke's optimistic comments about the US economy's health, spurred fears of a longer-than-expected credit-tightening campaign.
Hang Seng Index stocks opened weakly, then dived suddenly in the afternoon, tumbling 279.94 points, or 1.76 per cent, to end the day at 15,642.81, the largest one-day drop since October 12.
Turnover was $33.68 billion.
Of regional markets, only South Korea's fell further than the local market, dropping 2.01 per cent.
Kenny Tang Sing-hing, an associate director at Tung Tai Securities, said futures sellers used interest rate worries and the fact HSBC shares went ex-dividend - meaning anyone selling them now keeps their dividend - as the backdrop for a sell-off that began with Cheung Kong and Hutchison Whampoa shares.
