Hong Kong shares decline

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Hong Kong shares closed 1.19 percent lower Thursday, pulled down by property stocks and after a weak lead from Wall Street as markets await a key speech by US Federal Reserve chairman Ben Bernanke.

The benchmark Hang Seng Index fell 235.60 points to 19,552.91 on turnover of HK$42.43 billion ($5.47 billion).

Trading volume was light as investors awaited Bernanke's speech Friday at an annual economic symposium in Jackson Hole, Wyoming, in the hope he will signal the Fed is poised to start a new round of monetary easing.

Hopes were also lifted that the European Central Bank will resume its sovereign bond-buying programme to help the crisis-hit eurozone after bank chief Mario Draghi said the institution could resort to exceptional measures.

Shares in Hong Kong developers fell on fears the government may try to cool the property market after 90 percent of respondents to a poll said prices were too high, and recent reports of a flat selling for a record $61 million.

Cheung Kong dropped 2.7 percent to HK$103.80, Sun Hung Kai Properties closed 3.6 percent lower at HK$99.15, Henderson Land fell 3.4 percent to HK$46.70, and Sino Land tumbled 4.9 percent to HK$12.68.

“There are calls for the government to build flats that can only be sold to Hong Kong people,” Castor Pang, research head at Core Pacific-Yamaichi, told Dow Jones Newswires.

Automaker Dongfeng fell 2.3 percent to close at HK$10.06 after it reported an 8.4-percent decline in its first-half net profit Wednesday.

But rival Brilliance China Automotive rose four percent to HK$7.31 after the company reported its first-half net profit jumped 42 percent from a year earlier.

Chinese shares ended flat. The benchmark Shanghai Composite Index closed down 0.03 percent, or 0.65 points, at 2,052.59 on turnover of 50.8 billion yuan ($8.0 billion).

“Investors are worried the domestic economy may be in a further downward trend,” Jiang Shiqing, an analyst at Industrial Securities, told AFP.

Small firms fell as they suffer more from the economic slowdown. Gansu Dunhuang Seed slumped 7.52 percent to 7.13 yuan and Shanghai Jinfeng Wine dropped 4.71 percent to 11.32 yuan.

But Sinolink Securities surged by its daily limit of 10 percent to 11.87 yuan, leading gains in the brokerage sector on hopes a trial programme for margin trading will boost business.

Other financial-related stocks rose on bargain hunting. New China Life Insurance jumped 3.39 percent to 25.61 yuan, while Citic Bank added 1.31 percent to 3.88 yuan. - Sapa-AFP


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