BLBG: Hong Kong Stocks Enter Bear Market After Falling From April Peak
Hong Kong stocks entered a bear market as a rout in global equities deepened and the weakest Chinese manufacturing data since the financial crisis added to concerns about the world economy.
The Hang Seng Index sank 1.5 percent to 22,409.62 on Friday, taking its decline from an April 28 peak to 21 percent and sending the gauge to its lowest close since May 2014. The Hang Seng China Enterprises Index of mainland shares listed in the city lost 2 percent, while the Hang Seng Properties Index posted a 13th daily drop, the longest stretch on record, raising concern the cityâs real estate market is overvalued.
Cheung Kong Property Holdings Ltd. tumbled 3.6 percent. Tencent Holdings Ltd.fell 3.4 percent and China Construction Bank Corp. slid 2.2 percent, giving the most impetus to the benchmark measureâs decline. Lenovo Group Ltd., Kunlun Energy Co. and Hong Kong Exchanges & Clearing Ltd. have posted the steepest losses during the four-month slide.
âItâs not pretty,â said Mark Lister, head of private wealth research at Craigs Investment Partners Ltd. in Wellington, New Zealand, which manages about $7.2 billion. âThe whole worldâs looking a little bit sad at the moment.
Shares in the former British colony have been buffeted by the rout in China that destroyed some $4 trillion in market value, the yuanâs shock devaluation, plunging commodities prices and Thursdayâs U.S. market dive. The Shanghai Composite Index fell 4.3 percent on Friday to erase an 18 percent rebound from Julyâs market rout.
A report Friday showed a private gauge of Chinese manufacturing unexpectedly fell to the lowest level in more than six years, suggesting the worldâs second-largest economy will need further policy support to stem a deepening slowdown. Concern that demand is weakening has driven a commodities rout thatâs erased $2 trillion from the value of mining and oil companies since the middle of last year.
ââChina still looks really worrying on a number of fronts,â Lister said.