WSJ: Hong Kong Stocks: U.S., CyberWorks Sink Index
Dow Jones Newswires
HONG KONG -- Shares ended lower Thursday, mainly on the back of the rollover of futures contracts and Pacific Century CyberWorks' plunging share price after it posted wider-than-expected losses.
However, traders noted a rebound in H-shares, as investors concerned with the economic outlook in the U.S. and political uncertainty in Japan shifted their attention to China-related stocks.
The blue-chip Hang Seng Index ended down 173.52 points, or 1.35%, to 12677.89. The broader All Ordinaries Index finished down 63.32 points at 5214.67. Trading volumes were worth 7.886 billion Hong Kong dollars, compared with HK$6.882 billion in the previous session.
PCCW plunged to an intraday low of HK$2.975 -- its lowest level since its takeover of Cable & Wireless HKT last year -- after announcing a full-year net loss for 2000 of HK$6.91 billion late Wednesday. However, the Internet and telecom firm's shares rebounded late in the session, ending the day at HK$3.25, down 6.47%.
Traders said the rollover of March HSI Futures also contributed to the index's downward movement.
Thursday was the expiration date for the March futures, and some players were short-selling stocks, which pushed the index lower, said Herbert Lau, head of research at Celestial Asia Securities. He added investors were still concerned about declining stock prices in the U.S. and Japan. The Nasdaq fell 5.99% Wednesday to end at 1854.13, and the Nikkei ended Thursday 5.04% lower, at 13072.36.
Banking stocks also closed lower amid renewed concerns about a possible mortgage price war as home mortgage rates recently hit a 30-year low. Dao Heng Bank closed 0.82% lower at HK$90.25, and banking giant HSBC closed 1.36% lower at HK$90.75.
Banking shares are expected to continue their downward trend as fund managers trim investment portfolios to limit their exposure in the sector, he added.
On the other hand, China-related stocks bucked the downward trend Thursday, as investors concerned about U.S and Japan weakness shifted their funds to H-shares.
Tianjin Capital closed 4.8% higher at HK$1.32, on news of its restructuring, while Kunming Machine Tools closed 2.5% higher at HK$2.05.
Meanwhile, Li & Fung, which derives about 70% of its sales from the U.S., was another casualty of concern about the U.S. economy. Its shares fell 4.4% to HK$11.95,
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