Hang Seng Index drops by the most in five weeks as Hong Kong’s biggest protest rally in decades finds city on edge

The Hang Seng Index fell 1.7 per cent to 27,308.46, its biggest daily decline since a 2.4 per cent plunge on May 9 amid escalating tensions between the United States and China over trade

Stock indexes declined in Shanghai and Shenzhen, as China’s fastest inflation in 15 months weighed on investors

Reading Time:3 minutes

Police officers use a water canon on a lone protester near the government headquarters in Hong Kong on June 12, 2019. Photo: AFP

Published: 6:47pm, 12 Jun 2019Updated: 7:42pm, 12 Jun 2019

Hong Kong stocks fell by the most in five weeks, as traders pocketed their profits from a recent run-up in prices after the city’s police fired tear gas on demonstrators protesting a controversial extradition proposal.

The Hang Seng Index fell 1.7 per cent to 27,308.46, its biggest daily decline since a 2.4 per cent plunge on May 9 amid escalating tensions between the United States and China over trade.

“The main issue the market is facing is still the Sino-US trade tussle. We have not seen the end of that,” said Louis Tse Ming-kwong, managing director at VC Asset Management.

Declines in Hong Kong’s market weighed on mainland China’s two stock exchanges, which were already jittery over the highest monthly inflation data in 15 months, causing the Shanghai Composite Index to fall 0.6 per cent, while the benchmark on Shenzhen's bourse dropped 0.6 per cent.

A Sunday rally brought out hundreds of thousands of protesters – organisers said 1 million showed up, while the police put the turnout at 240,000 – on to the city’s streets to oppose a proposed extradition bill, in the biggest demonstration since the 1997 handover of Hong Kong by the United Kingdom to China. The proposal would allow suspects to be transferred to jurisdictions with which the city does not have an extradition agreement, including mainland China.

Select Voice

Choose your listening speed

Get through articles 2x faster

1.25x

250 WPM

Slow

Average

Fast

00:0000:00

1.25x