Hong Kong stock losses deepen as Ping An Insurance slides on Founder rescue plan while China markets shut for holiday

Hang Seng Index dropped 1.3 per cent, adding to its biggest drop in a month on Friday

Ping An Insurance slides as the Chinese insurer joins a consortium in a financial restructuring to rescue troubled Founder Group

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Stocks slip in Hong Kong as Ping An Insurance tumbles and support from mainland traders is sorely missed on trading pause. Photo: Reuters

Published: 11:03am, 3 May 2021Updated: 5:28pm, 3 May 2021

Hong Kong stocks tumbled as heavyweight financials Ping An Insurance and HSBC slumped, adding to recent losses stoked by a clampdown on Chinese technology companies.

The Hang Seng Index fell 1.3 per cent to 28,357.54. The gauge slipped 1.2 per cent last week from the highest level since March 18, as China signalled tightening oversight of internet-platform operators. Markets in mainland China are shut from Monday to Wednesday for holidays.

Trading volume reached HK$96 billion (US$12.36 billion), compared to an average daily turnover of HK$135 billion last week, according to stock exchange data.

“Market sentiment remains weak. The market also lacks supporting liquidity inflows from the mainland,” said Stanley Chan, director of research at Emperor Securities. “Concerns about inflationary pressure and rising bond yields remain and continue to have some psychological impact on the markets.”

Ping An Insurance (Group) fell 2.5 per cent to HK$82.85. China’s biggest insurer said in an exchange filing late Friday that its unit Ping An Life will join a consortium to rescue debt-laden Founder Group.

The insurer will inject as much as 50.8 billion yuan (US$7.84 billion) to take up a controlling stake in a new Founder Group unit, according to the filing. Founder Holdings soared as much as 125.5 per cent to HK$1.06 after the announcement, before paring gains to a 85.1 per cent increase to HK$0.87.

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