Hong Kong stocks end in negative territory, paring upbeat weekly performance as attention shifts to Tencent’s earnings

PUBLISHED : Friday, 16 March, 2018, 10:20am
UPDATED : Friday, 16 March, 2018, 11:18pm

Hong Kong stocks ended lower on Friday, but managed to finish the week in positive territory, capping the second straight week of gains amid strong earnings expectations for blue-chip stocks.

The Hang Seng Index closed down 0.1 per cent at 31,501.97. For the week the index was up 1.6 per cent.

The Hang Seng China Enterprises Index dropped 0.4 per cent to 12,673.07, paring its five day gain to 1.9 per cent.

Tencent Holdings eased 0.7 per cent, trimming its gain for the week to 4 per cent. The share closed at HK$465.20, a short distance from its all-time high of HK$476.60. The Chinese internet and social media giant is scheduled to unveil full-year results next Wednesday. Analysts are forecasting net profit ranging between 62.64 billion yuan (US$9.91 billion) to 68.94 billion yuan, reflecting a rise of 38 per cent to 52 per cent from a year earlier.

Ping An Insurance and Geely Automobile Holdings also attracted buying ahead of their earnings releases next week, ending up 6 per cent and 2.3 per cent respectively for the week.

Still, analysts said fears are rising among investors about a potential global trade war after US President Donald Trump said his administration will seek to cut the nation’s trade deficit with China by US$100 billion. The remarks came after he said earlier this week the US is considering tariffs on up to US$60 billion of Chinese goods in the technology and telecom sectors.

“Concerns about a potential trade war and rate hikes have kept Hong Kong stocks in a range-bound pattern [on Friday] as there’s a global decrease in risk appetite,” said Ken Chen, a strategist at KGI Securities in Shanghai.

“How this will evolve is worth close attention, ” said Kenny Wen Kit, a strategist for Everbright Sun Hung Kai Investment. “It adds uncertainty to the Hong Kong market.”

CK Hutchison Holdings rose 0.3 per cent to HK$98.90, and CK Asset Holdings inched up 0.1 per cent to HK$70.

Li Ka-shing, chairman of the two companies, and the richest man in Hong Kong, announced after the market close that he will step down as chairman and retire from the position of executive director at the forthcoming general meeting in May, while his elder son Victor Li will take over.

Billionaire tycoon Li Ka-shing retires, hands control of empire to son Victor

Hong Kong Exchanges & Clearing, the operator of the city’s bourse, sank 2.6 per cent to HK$282.00. Bank of East Asia shed 0.7 per cent to HK$33.35 and Industrial & Commercial Bank of China lost 1.1 per cent to HK$6.92.

China Unicom gained 1.5 per cent to HK$9.68, after reporting a nearly threefold increase in net profit for last year.

In mainland China, the Shanghai Composite Index closed 0.7 per cent lower at 3,269.88, bringing its loss for the week to 1.1 per cent. The large-cap CSI300 dropped 1 per cent to end at 4,056.42.

Skyworth Digital, which produces consumer electronics, soared by its daily limit of 10 per cent to 8.9 yuan, after search engine giant Baidu said it plans to invest 1.01 billion yuan in the company’s smart television unit Coocaa.