Monday, September 12, 2011

HK shares tumble 4.2%, HSBC leads retreat

HONG KONG: Hong Kong shares finished down 4.21 percent on Monday, Sept 12 led by HSBC Holdings Plc , which dropped to its lowest since July 2009 on concern over costs related to banking reforms in Britain.

The Hang Seng Index shed 836.09 points to close at 19,030.54, breaking below trendline support connecting intraday lows over the past month and paving the way for a retest of the Aug. 9 low at 18,868.1. The China Enterprises Index tumbled 4.8 percent.


* Europe's largest lender HSBC fell 5.5 percent to levels last seen in July 2009, while smaller rival Standard Chartered Plc lost 4.4 percent on concern over the impact of banking reforms in Britain. The Independent Commission on Banking outlined plans to shield bank retail operations from riskier investment banking units, with the estimated cost of its proposals at 4-7 billion pounds for Britain's banks.

* An 11.2 percent drop in August sales for China Overseas Land & Investment Ltd fell 7.5 percent. Investors sharply cut back on their positions, giving the stock its biggest single-day drop since Oct. 2008 in relatively good volume. The weak numbers also hit other Chinese property stocks, with China Resources Land Ltd down 5.3 percent and Evergrande Real Estate Group Ltd dropping 9.3 percent.

* Not a single Hang Seng Index component was in positive territory, although defensive utility issues such as CLP Holdings Ltd and Hong Kong & China Gas Co Ltd continued their outperformance, down 0.5 percent and 1.5 percent respectively. Utilities along with telecommunications stocks have seen growing interest from investors attracted by stable cash flows, predictable earnings and relatively low dependence on economic growth. - Reuters

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