Wall Street bloodbath spills over to Hong Kong, China stocks
Shanghai stock market closes at lowest level in four years; tech giant Tencent plunges by 6.8 per cent as benchmark Hang Seng Index loses more than 900 points in Hong Kong
Stocks in Hong Kong and Shanghai plunged on Thursday as a sell-off on Wall Street spread to Asia, after rising bond yields and higher interest rates spooked investors and caused a broad market rout.
The Chinese onshore yuan was also hit hard, sinking to 6.9331 per dollar, a 21-month low, before bouncing back to 6.9265 late in the afternoon.
Hong Kong’s benchmark Hang Seng Index briefly tanked by 1,068 points, or 4.1 per cent, to 25,125.22, its lowest intraday level since May last year. It closed at a 17-month low of 25,266.37, down 926.70 points, or 3.54 per cent, which is also its biggest single day fall since February 6, 2018, when it dropped by 5.1 per cent.
Overnight, in the US, the Dow Jones Industrial Average and the S&P 500 both slid by more than 3 per cent, for their worst day since February. The Nasdaq logged a 4.1 per cent loss, its biggest decline of 2018. The yield on US 10-year Treasury notes briefly jumped to 3.23 per cent, before dropping back slightly.
Hong Kong stocks are likely to test new lows
Stocks in Shanghai sank by 5.2 per cent to close at their lowest level in four years. Other Asian markets shared the pain, with Japan’s Nikkei 225 index dropping by 3.9 per cent, South Korea’s Kospi declining by 4.4 per cent, Taiwan’s benchmark index shedding 6.3 per cent and Australia’s S&P/ASX200 losing 2.7 per cent.