HK Shares End Dn Despite US Gains As Mkt Shrugs At Fed
Tuesday, March 20 4:31 PM SGT
HONG KONG (Dow Jones)--Most Hong Kong stocks moved lower Tuesday, surprising those who expected a boost from stronger U.S. stocks, and as local investors all but shrugged at the likelihood of easier policy from the U.S. Federal Reserve.
A couple of the big banks gained slightly, most notably Dao Heng Bank, despite a mixed response to its interim results, while HSBC Holdings flirted with modest gains much of the session.
But most everywhere else, the market was losing ground, albeit amid modest volume, as investors looked past the meeting later Tuesday of the U.S. Federal Reserve's Open Market Committee - local players have priced in a half-point rate cut - to what many think is a rocky few weeks to come.
Antony Mak, dealing director at Vickers Ballas Holdings, reckons the Hang Seng Index will soon test down to 13000, acknowledging that Tuesday's losses came a bit of surprise given light gains overnight in New York.
The Hang Seng Index closed down 233.83 points, or 1.74%, at 13223.86, and just above the day's low at 13200.55. As trading got started it looked likely to follow the U.S., and hit a high at 13565.97. Volume was low at HK$5.8 billion.
Ricky Tam, research director at Pacific Challenge, said sellers were focused on telecommunications shares, where fears of a price war in China between the biggest players were rippling through the market and upset sentiment.
China Mobile Ltd. ended down 3.41%, or HK$1.30, at HK$36.80, while China Unicom was off HK$3.03, or 30 cents, at HK$9.6. Pacific Century Cyberworks finished down 2.56% at HK$3.8. SmarTone Telecommunications managed to edge up at the end of the day to close up 0.49% at HK$10.35.
"A lot of people are worried about telecom stocks because they are worried that China Mobile and China Unicom will enter into a price war," said Tam. - - 20/03/01 08-31G
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