China stock market

Hong Kong, mainland Chinese stocks catch a chill after first falls in seven weeks

The Shanghai Composite Index lost just under 1 per cent to end the day at 3,523 on Monday – the biggest drop since December 12. Hong Kong’s Hang Seng Index slid 0.56 per cent to end the day at 32,966.89

PUBLISHED : Monday, 29 January, 2018, 9:24am
UPDATED : Monday, 29 January, 2018, 11:45pm

Hong Kong stocks fell on Monday after rising for seven straight weeks, led by index heavyweight insurers and conglomerates. Mainland stock markets also retreated the most in the same period.

The benchmark Hang Seng Index dropped 0.56 per cent, or 187.23 points, to 32,966.89.

The Hang Seng China Enterprises Index, known as the H-shares index, also ended down 0.47 per cent at 13.659.59.

But turnover was HK$191.63 billion (US$127.9 million), up four per cent from last week’s daily average.

Insurers and conglomerates led the fallers, with AIA losing 1.8 per cent, Ping An ending down 2.94 per cent, CK Hutchison Holdings dropping 1.78 per cent and Fosun International trended 2.18 per cent lower.

“The declines were caused by profit-taking as well as some switching from traditional stocks to commodities on the continuing weakness of the US dollar,” said Louis Tse, managing director at VC Asset Management.

The stocks that gained the most last year bore the brunt of the sell-off, as traders cut their holdings to lock in the outsize gains in what analysts considered as profit taking.

Wynn Macau, the casino operator owned by billionaire Steve Wynn, tumbled 6.5 per cent to HK$28.05 after The Wall Street Journal reported the tycoon has had a long history of sexual misconduct and had improperly pressured some employees.

Wynn has reportedly paid US$7.5 million to settle claims brought by a former manicurist at his resort, the US paper said. The magnate has denied the allegations.

Wynn Resorts, the parent of Wynn Macau, tumbled a whopping 10 per cent in US trading on Friday.

In mainland trading, the Shanghai Composite Index lost just under 1 per cent, or 35.13 points, to end the day at 3,523 – the biggest drop since December 12.

The large-cap CSI 300 also lost 1.8 per cent to 4,302.02, with index heavyweight, the Chinese white spirit maker Kweichow Moutai and Gree Electric Appliances leading the declines among consumer stocks on concerns both had been rising too fast.

Leading liquor brand Moutai tumbled 5.25 per cent to 736.4 yuan (US$127.9), while home appliances maker Gree Electric lost 2.82 per cent to 55.78 yuan.

“The market will probably continue to be volatile as stocks, particularly the big caps, have had decent gains, and it will take some time for the market to digest that,” said Wei Wei, a trader at Huaxi Securities in Shanghai.

Wangsu Science & Technology had a roller-coaster day in its share price. The stock dipped 1.5 per cent to 13.13 yuan, erasing an earlier 10 per cent gain. The Shenzhen-listed maker of content delivery networks said in an exchange filing on Sunday it had not had any talks with Tencent Holdings on stock investment or receiving intent from the technology giant, clarifying recent media reports to the contrary.

The Shenzhen Composite Index ended 1.56 per cent lower to 1,919.8 and The Nasdaq-style ChiNext slid 0.94 per cent to 1,799.77.