Hong Kong stocks post biggest decline in a month as risk-off mood takes hold amid rising Middle East tension
- The Hang Seng Index slid 0.8 per cent, or 225.31 points, to 28,226.19 on Monday, the steepest decline since December 4
- The Shanghai Composite Index fared slightly better as sell-offs were tempered by the forthcoming signing of a phase-one trade deal between Beijing and Washington
Hong Kong stocks fell the most in a month as traders adopted a risk-averse mood amid mounting geopolitical tension after the US killed a top Iranian military commander in an air strike.
The Hang Seng Index slid 0.8 per cent, or 225.31 points, to 28,226.19 on Monday, the steepest decline since December 4. Almost all major benchmarks elsewhere in Asia sank, with Japan’s Nikkei 225 Index retreating 1.9 per cent for the worst performance among them. Gold futures traded at a six-year high after the attack.
The mainland’s Shanghai Composite Index fared better, falling less than 0.1 per cent, as sell-offs were tempered by the forthcoming signing of a phase-one trade deal between Beijing and Washington.
“Equity markets across the region will continue to remain under pressure,” said Jeffrey Halley, an analyst at Oanda in Singapore. “Haven assets remain solidly in demand across the board in Asia.”
All but eight constituents of the 50-member Hang Seng Index fell, with property stocks providing the biggest drag. Wharf Real Estate Investment dropped 3.2 per cent to HK$45.15 and Country Garden Holdings lost 2.1 per cent to HK$12.32.
Oil producers rallied as the US attack boosted crude oil futures to their highest level since April. PetroChina rose 4 per cent to HK$4.20 and Cnooc gained 3.6 per cent to HK$13.72.
Mainland China’s stocks recovered almost all their intraday losses as the South China Morning Post reported that Beijing’s trade delegation tentatively plans to travel to Washington on January 13 to sign the phase-one deal that would herald an official truce in the trade war between the world’s two biggest economies.