Hong Kong stocks end lower, pressured by losses in financials and utilities

Mainland China shares edged up, ahead of a raft of monthly economic data

PUBLISHED : Wednesday, 13 September, 2017, 9:22am
UPDATED : Wednesday, 13 September, 2017, 9:55pm

Hong Kong stocks retreated on Wednesday as investors took profit in financials and utility stocks, while mainland Chinese stocks remained steady ahead of an economic data release.

The Hang Seng Index slid 0.3 per cent, or 78.16 points, to 27,894.08, ending a rally of 2 per cent since last Thursday and failing to make a clean break above the psychologically significant 28,000 level after four attempts in the past two weeks.

The Hang Seng China Enterprises Index, known as the H-share index, fell 0.5 per cent, or 54.99 points, to 11,187.07.

“Strong performances among new economy and technology companies would be what is needed to push the Hang Seng Index above the key 28,000 level,” said Gordon Tsui, managing director at Hantec Pacific.

There will be a lot of “arm wrestling” between bulls and bears when the index gets closer to the 28,000 level, and the market is likely to lose the upward momentum if turnover shrinks, said Louis Tse Ming-kwong, a director of VC Brokerage.

Daily turnover stood at HK$90 billion, little changed from Tuesday.

Banks and insurers declined. ICBC was down 1.4 per cent, and China Construction Bank dropped 1 per cent. Bank of China eased 1 per cent, and AIA shed 0.3 per cent.

Utilities also pulled back. Towngas, Hong Kong’s sole supplier of piped gas, dropped 0.5 per cent. Electricity supplier CLP Holdings was down 0.9 per cent, and CK Infrastructure Holdings declined 0.9 per cent too.

“People may want to trim down their portfolios and repatriate gains in Hong Kong stocks to A-shares in mainland China,” as the Chinese yuan strengthened against the US dollar over the past two months, said Tse.

Apple-related stocks reversed early losses and closed up, following the unveiling of the iPhone X, the 10th anniversary edition of the iPhone. Sunny Optical, which supplies smartphone components for Apple, added 4.4 per cent, while AAC Technologies gained 1.3 per cent.

Carmakers continued to lend support to the market, after China said on Saturday it is working on a timetable to phase out the production and sale of fossil-fuel vehicles. BYD was up 6.6 per cent, while Geely increased 0.7 per cent.

China National Building Material, China’s largest producer of cement, jumped 12.5 per cent, after announcing a merger with smaller rival Sinoma.

Mainland Chinese stocks edged up, as investors remained confident ahead of a raft of August economic data due to be released on Wednesday evening and Thursday. The data batch includes monthly figures on money supply, lending, industrial production, retail sales and fixed-asset investment.

The Shanghai Composite Index added 0.1 per cent, or 4.66 points, to 3,384.15, while the CSI 300 – which tracks companies in Shanghai and Shenzhen – also inched up 0.1 per cent, or 4.68 points, to 3,842.61.

The Shenzhen Composite gained 0.4 per cent, or 8.77 points, to 1,994.98, while the Nasdaq-style ChiNext rose 0.2 per cent, or 3.95 points, to 1,888.43.

Elsewhere in Asia, Japan’s Nikkei 225 rose 0.5 per cent to 19,865.82. South Korea’s Kospi fell 0.2 per cent and Australia’s All Ordinaries declined 0.04 per cent.