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Hang Seng loses US$220 billion in November pullback as Omicron, Macau gambling crackdown add to Chinese tech earnings woes
- Hang Seng Index fell for a third day to a 14-month low as Omicron sapped risk appetite while a sell-off in Macau casino operators prolonged
- An improvement in official Chinese manufacturing data failed to shore up sentiment amid growing Covid-19 infection cases sparked by the new variant
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Hong Kong stocks fell for a third day to the lowest level in 14 months amid concerns the Omicron coronavirus variant will derail global economic recovery. An improvement in Chinese manufacturing data failed to shore up sentiment.
The Hang Seng Index retreated 1.1 per cent to 23,591.68 at the close of Tuesday trading. The benchmark slid 7.7 per cent this month to a level not seen since September last year, erasing US$220 billion of market value from its members. The Hang Seng Tech Index slipped 1 .2 per cent while the Shanghai Composite Index was little changed.
The Hang Seng Index retreated 1.1 per cent to 23,591.68 at the close of Tuesday trading. The benchmark slid 7.7 per cent this month to a level not seen since September last year, erasing US$220 billion of market value from its members. The Hang Seng Tech Index slipped 1 .2 per cent while the Shanghai Composite Index was little changed.
Alibaba Group Holding, Tencent Holdings and Meituan declined 0.7 per cent to 2.9 per cent, pacing index losers, following a poor third-quarter earnings reports. China Resources Land and Mengniu Dairy both declined by at least 4.8 per cent.
Investors reduced risk-taking as the new Covid-19 variant triggered a surge in global infection cases. Countries including Japan, Britain and the US have imposed travel curbs while Hong Kong tightened entry rules for high-risk countries with reported infections.
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“A new, highly contagious, virus strain could trigger growth downgrades, worsen risk sentiment,” BlackRock strategists said in a note to clients on November 29. “We still favour equities for now but would change our stance if vaccines or treatments were to prove futile.”
Global banks and financial institutions have been weighing its impact on markets, with JPMorgan Asset Management seeing the Omicron variant as a “bump in the road to recovery.” Investors may view any continued sell-off as a buying opportunity, Invesco said.
02:28
What do we know about the new coronavirus variant Omicron?
What do we know about the new coronavirus variant Omicron?
Elsewhere, manufacturing in China expanded slightly in November, with the official purchasing managers’ index rising to 50.1 from 49.2 in October, the statistics bureau said on Tuesday. The index was expected to increase to 49.7, according to economists tracked by Bloomberg.
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