* Hang Seng down 2.4%, H-shares fall 2.7%
* Both indexes had worst week since late Jan.
* Coronavirus spreads beyond China, spooks global markets
* Trading volume highest since Feb. 2019
HONG KONG, Feb 28 (Reuters) - Hong Kong stocks fell on Friday, posting their worst week in a month, as the rapid spread of the coronavirus across the world sparked fears of contagion and sent global markets reeling.
** At the close of trade, the Hang Seng index was down 2.4% at 26,129.93. The index is down 4.3% week-on-week and 0.7% from the previous month.
** The Hang Seng China Enterprises index fell 2.7% on Friday, down 4.5% from the previous week but up 0.6% from January. ** Both indexes marked their worst week since late January.
** The sub-index of the Hang Seng tracking energy shares dipped 3.5%, the IT sector lost 3.4%, the financial sector ended 2% lower and the property sector fell 2.2%. ** Countries on three continents reported their first cases of the coronavirus on Friday as the world prepared for a pandemic of the disease and investors dumped equities in expectation of a global recession.
** Chinese policymakers have implemented a raft of measures to support an economy jolted by a coronavirus outbreak that is expected to have a devastating impact on first-quarter growth. ** On Wednesday, Hong Kong unveiled a record budget deficit, pledging cash handouts to residents and business tax breaks to soften the blow to the recession-hit economy from often-violent protests and the coronavirus. ** China’s monetary policy to hedge the impact of the coronavirus could release ample liquidity, which bodes well for Hong Kong equities, said Lin Hongyi, analyst at Yunfeng Financial Group, in a report. ** After the launch of the Stock Connect, Hong Kong stocks, given its lower valuations than their mainland peers, have been attracting long-term funds from the mainland, Lin said.
** On Friday, southbound flows into the Asian financial hub continued their strong momentum, with mainland investors purchasing nearly 5 billion yuan worth of HK-listed shares. ** At close, China’s A-shares were trading at a premium of 26.73% over Hong Kong-listed H-shares.
** About 3.19 billion Hang Seng index shares were traded, highest daily volume since Feb. 2019. The volume traded in the previous trading session was 2.11 billion.
Reporting by Luoyan Liu and Noah Sin; Editing by Amy Caren Daniel