Hong Kong stocks post biggest daily fall in a month as weak China manufacturing data fuels fears of a slowdown

Hong Kong stocks fell the most in a month on Tuesday, hit by China’s weaker-than-expected manufacturing data that fuelled worries of slowing economic growth amid the ongoing US-China trade war.

The Hang Seng Index dropped 2.4 per cent, or 662.14 points, to 27,126.38, which is the biggest single day fall since September 5 when it fell 2.6 per cent.

The Hang Seng China Enterprises Index also fell 2.4 per cent, or 263.31 points, to 10,754.56 – the biggest single day loss since June 19 when it lost 3.2 per cent.

Brokers said the sharp fall was because of worries about China’s economic outlook. As the mainland market is closed until October 7 because of the Golden Week holiday, the selling pressure was concentrated in Hong Kong, they added.

“US tariffs on China exports are starting to bite,” said Louis Tse Ming-Kwong, managing director of VC Asset Management.

The Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) released over the weekend fell to 50 in September, below the 50.5 level forecast by economists polled by Reuters and 50.6 recorded in August. The 50-mark divides expansion from contraction on a monthly basis.

The Chongqing People’s Congress proposed to remove the city’s natural gas installation fee to reduce costs for households and to advance price reforms, in moves that would eat into the income of Chinese gas producers.