Hong Kong stocks fall as rally loses steam

A woman looks at an electronic billboard displaying the Hang Seng Index numbers in Hong Kong, China, 11 February 2016. The Hang Seng Index slumped 3.8 percent in the morning as markets reopened following a three-day trading break, headed for their worst start to a lunar new year since 1994 . EPA

SHANGHAI: Hong Kong stocks fell for the third straight session on Monday, as the market's strong months-long rally showed signs of fatigue.

Sentiment was also hurt by bearishness in mainland China markets, where blue chips had their worst day in two months amid worries about tighter regulation.

The Hang Seng index dropped 0.2 percent to 23,919.46 points, while the Hong Kong China Enterprises Index lost 0.8 percent, to 10,338.12.

The Hang Seng is under increasing pressure from profit-taking, having climbed over 8 percent so far this year on the back of Wall Street bullishness and share purchases by mainland investors, including insurers.

The gains had pushed it well into technically overbought territory, leaving it vulnerable to a pullback.

Gao Ting, head of China strategy at UBS Securities, said regulators have set risk prevention as their main emphasis, reducing the chance of aggressive buying by insurers on the secondary market.

Still, "we expect insurers to be the main contributor of southbound trading this year," he said.

Most sectors fell on Monday, with energy shares among the worst performers.

Hong Kong Exchanges and Clearing Ltd (HKEX) fell 1.3 percent, after the city's stock exchange operator said its 2016 net profit fell 27 percent due to a decline in trading fees. - Reuters
Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 1
Cxense type: free
User access status: 0
Subscribe now to our Premium Plan for an ad-free and unlimited reading experience!

Next In Business News

Wall St eyes higher open ahead of inflation data as bank fears fade
US weekly jobless claims rise moderately; fourth-quarter GDP trimmed
MyEG inks deal with China Customs on cross-border trade connectivity
Federal govt debt could be fully settled in 2053: MoF
Pharmaniaga only manages 35% of government’s pharmaceutical spending
Ringgit closes lower against US dollar on lack of catalysts
UEM Sunrise's Azmy Mahbot to take on CFO duties during transition period
Tanco wins RM43.37mil contract for ECRL project
PTT Synergy acquires Pembinaan Tetap Teguh for RM152mil
Berjaya Assets sells 0.36% equity interest in 7-Eleven for RM7.58mil

Others Also Read