October 12, 2016 / 5:01 AM / 2 years ago

Hong Kong, China stocks fall on US rate hike worries, weaker yuan

* SSEC -0.3 pct, CSI300 -0.3 pct, HSI -1.1 pct

* Risk appetite curbed as global markets face growing uncertainty

* Yuan’s recent weakening hurts appeal of China, HK stocks-trader

SHANGHAI, Oct 12 (Reuters) - Hong Kong and China stocks fell on Wednesday amid signs of increasing volatility in global markets as investors brace for the U.S. presidential election, a possible U.S. rate hike and bruising negotiations on Britain’s exit from the European Union.

Also hurting sentiment is the weakening yuan, which touched a fresh six-year low on Wednesday, fuelling speculation of further depreciation and hurting the appeal of yuan-denominated assets.

In China, both the blue-chip CSI300 Index and the Shanghai Composite Index lost 0.3 percent to 3,296.5 and 3,055 points, respectively.

Hong Kong’s benchmark Hang Seng Index dropped 1.1 percent to 23,291.92, while the Hong Kong China Enterprises Index lost 1.8 percent to 9,631.82.

Asian shares flirted with three-week lows on Wednesday after U.S. stocks dropped over 1 percent overnight, as the dollar and Treasury yields rose on growing expectations of a U.S. rate hike in December.

The recent slump in the British pound, triggered by concerns of a costly “hard Brexit”, also curbed risk appetite.

Shen Weizheng, Shanghai-based fund manager at Ivy Capital, said investors were also concerned about the potential economic fallout as a growing number of Chinese cities impose restrictions on home purchases to cool soaring prices.

“Real estate is very important to China’s economy. Now that property sales are restricted, many industries would be hurt, including appliance makers, car companies and furniture producers.”

A wave of restrictions imposed on housing markets in major Chinese cities last week have unnerved some buyers and developers, cutting sales in places such as Beijing and Shenzhen by more than half.

All main sectors fell in Hong Kong and China.

An index tracking Hong Kong’s listed property developers , many of whom have major exposure to mainland China, fell to a two-month low.

Raw material shares also dropped sharply in both China and Hong Kong markets.

Samuel Shen and John Ruwitch; Editing by Kim Coghill

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below