It seems the severe El Ni¤o flood in China only deepen its internal economic pain.
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Friday's Asian Markets: Hong Kong Reels on Devaluation Threats
Hong Kong, Aug. 7 (Bloomberg) -- Hong Kong stocks tumbled, driving the benchmark index to a three-and-a-half-year low, and currencies fell across Asia amid speculation China will devalue the yuan to spur growth.
Hong Kong interest rates surged to two-month highs and the U.S. dollar rose against the yen, the Thai baht, the South Korean won, the Malaysian ringgit and other Asian currencies. In Vietnam, the government cut the value of the dong by 7 percent.
Hong Kong's benchmark Hang Seng stock index fell as much as 2.4 percent, led by banks such HSBC Holdings Plc and property companies such as Swire Pacific Ltd., amid concern a yuan devaluation could also spell the end of the Hong Kong dollar's 15- year-old link to its U.S. counterpart.
Stocks also fell in Malaysia, Singapore and the Philippines while Japan's Nikkei 225 index rose for the first time this week after a rally on Wall Street. ''For companies big and small, the pain could be acute,'' said Dong Tao, North Asia economist at CS First Boston (Hong Kong) Ltd.
As the yuan fell to a five-year low on Shanghai's black market, Taiwan's currency slipped a seven-week low and stocks were mixed. ''People here are deeply worried the yuan's fall will hurt the already-battered Taiwanese exports,'' said Michael Kuo, a trader for Chinatrust Commercial Bank, the banking unit of conglomerate the Koo's group. ''Few exporters are selling their dollar holdings.''
Asustek Computer Inc. and other computer-related issues were boosted by gains in U.S. technology stocks,
The benchmark TWSE index rose 20.55, or 0.27 percent, to 7,501.27. That's after it lost 430.66, or 5.4 percent, in the past 10 days. |
