Hang Seng Index falls furthest in five years, with banks and builders leading losses, as Beijing moves to tighten grip on city
- The Hang Seng Index capped the biggest decline in almost five years as China’s legislature is set to vote on a security law that will increase Beijing’s control over Hong Kong
- All 50 members of the city’s benchmark fall, with developers and banks being the worst-performing industry groups
The benchmark sank 5.6 per cent, or 1,349.89 points, to 22,930.14 on Friday, its biggest decline since July 2015. All 50 constituents on the gauge fell, with property developers and banks leading the pack of decliners. The index was the worst performer in the Asia-Pacific region, where most equity gauges saw mild losses. The mainland’s Shanghai Composite Index fell 1.9 per cent to 2,813.77.
The Hong Kong currency weakened for a second day to trade at 7.7574 against the US dollar, extending a deprecation of 0.06 per cent for its biggest single-day loss since April 9.
Further downside pressure on Hong Kong stocks has been building up, as the South China Morning Post reported that China has proposed the deliberation of the security law bill during the National People’s Congress (NPC), the nation’s highest annual legislative conference, which kicked off in Beijing on Friday morning. A spokesman for the NPC confirmed the bill at a press conference on Thursday night.