Hong Kong - Hong Kong stocks fell, with the benchmark index closing at its lowest in two weeks, as energy shares dropped and Tingyi (Cayman Islands) Holding led declines.
Shares jumped earlier after police cleared more pro-democracy protest barricades in the city’s business centre.
Cnooc, China’s largest offshore energy explorer, fell 3.1 percent as crude prices extended losses.
Tingyi (Cayman Islands) Holding dropped as the snackmaker’s Taiwan affiliate plunged on food safety concerns.
Agile Property Holdings climbed 5.1 percent after plunging the most since October 2011 yesterday.
The Hang Seng Index fell 0.4 percent to 23,047.97 at the close in Hong Kong after rising as much as 1.2 percent.
The Hang Seng China Enterprises Index fell 0.3 percent to 10,254.79, sliding at least 10 percent from its high in September, meeting the common definition for a correction.
Hundreds of police officers this morning pulled down tents and bamboo obstacles blocking the key Queensway thoroughfare.
“This morning’s rally may be from police clearing out the barricades exciting investor sentiment, but people are now switching back to fundamentals like the US interest-rate outlook and Chinese government policy,” said Steven Leung, director of institutional sales at UOB-Kay Hian Holdings.
“People are still looking out for the start date to be announced for the Hong Kong-Shanghai stock connect.”
The cross-border trading program will allow foreign investors to purchase mainland stocks, while giving Chinese investors access to Hong Kong-listed equities.
The Hong Kong bourse’s chief executive Charles Li said last month he hopes regulators will give two weeks of notice on the start date.
The link is scheduled to start this month after being announced in April.
Relative Value
The Hang Seng Index traded at 10.6 times estimated earnings compared with 15.6 for the Standard & Poor’s 500 Index yesterday.
Uncertainty about China’s economic growth and US interest-rate policy helped drag the Hong Kong gauge down 9 percent from this year’s high.
Federal Reserve officials said at the weekend that interest-rate increases might be delayed should slowdowns in other countries threaten US economic expansion.
Cnooc fell 3.1 percent to HK$12.52, the biggest drag on the Hang Seng Index.
PetroChina, the country’s largest oil and natural gas producer, retreated 0.7 percent to HK$9.50.
West Texas Intermediate extended its rout from the lowest price in 22 months, sliding as much as 1.1 percent in New York.
Tingyi fell 4.7 percent to HK$18.96.
Its affiliate Wei Chuan Foods, the Taiwanese food company whose chairman resigned amid a tainted lard scandal, plunged for a fourth day.
The company said last month it expects to lose $2.65 million through product recalls and lost inventory.
Barricades Pulled Down
Protesters in Hong Kong didn’t seek to stop removal operations as police today cleared parts of the popular Causeway Bay shopping district.
The Hang Seng Index fell 2.7 percent since police used tear gas to try to disperse tens of thousands of protesters on September 28, which led to the blocking of traffic on several main roads.
Agile jumped 5.1 percent to HK$4.15.
The Chinese developer whose shares plunged yesterday on resuming trading after announcing its chairman Chen Zhuolin was confined by prosecutors, is in talks with bankers to delay loan repayments after scrapping a rights offer, according to people familiar with the matter.
Futures on the S&P 500 gained 0.4 percent today.
The ratio of total short selling by value on Hong Kong’s mainboard versus the shares traded reached almost 1-to-8 yesterday, the highest level since February 24, according to data compiled by Bloomberg. - Bloomberg News