Hong Kong stocks slide on China slowdown concerns as Evergrande sinks to seven-year low on debt crisis
Hong Kong stocks fell for a second day before reports on China’s economy indicating a deeper slowdown in August. China Evergrande slumped to the lowest since 2014 after it hired financial advisers to tackle its debt burden.
The Hang Seng Index sank 1.2 per cent to 25,502.23 at the
close on Tuesday. The Hang Seng Tech Index lost 1.4 per cent, adding to a 2.3
per cent decline on Monday sparked by concerns about tightening fintech
regulations. China’s Shanghai Composite Index retreated 1.4 per cent.
Alibaba Health Information Technology and Country Garden
Holdings slumped by at least 5.3 per cent, among the market’s worst performers.
Countering losses, PetroChina advanced 3.9 per cent after crude oil topped
US$70 a barrel, as a storm approaching the Gulf of Mexico clouded supply
outlook.
China Evergrande, the country’s most-indebted developer,
tumbled 12 per cent to a seven-year low of HK$2.97, bringing its slump to 80
per cent this year. The firm hired Houlihan Lokey and Admiralty Harbour Capital
as financial advisers to tackle its debt problem, it said in a stock exchange
filing on Tuesday, a precursor to potential restructuring of its offshore debt.
A new batch of China’s economic report cards may offer an
insight into how Asia’s largest economy is faring amid pockets of lockdowns
triggered by the sporadic Delta outbreak. An unprecedented crackdown on
industries ranging from internet platform operators to private education may
also hurt spending confidence.
“Major overseas economies may face a slowdown going forward
and the room for further monetary and fiscal boost is very limited,” said Wang
Yitang, an analyst at Huaxi Securities. “That will have repercussions on the
Hong Kong market. The risk of a pullback from the recent market rebound is
growing.”
Retail sales, industrial production and investments probably
all moderated last month, according to estimates of analysts tracked by
Bloomberg. The government will release the August statistics at 10am on
Wednesday.
Elsewhere, most equity markets in the region traded higher
on Tuesday, with Japan’s Nikkei 225 reaching the highest point since 1990
before an expected Cabinet reshuffle.
Comments
Post a Comment