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To: EPS who wrote (6604)	8/13/1998 7:14:00 AM
From: Oracle	Respond to of 22640

"Japan seems like yesterdays news, here comes russia : -" HK stocks end with heavy losses on Russia worries HONG KONG, Aug 13 (Reuters) - Hong Kong stocks ended with hefty losses on Thursday as fears of a devaluation of the Russian rouble and talk of another speculative attack on the Hong Kong dollar prompted heavy selling, analysts said. The Hang Seng Index fell 199.06 points, or 2.90 percent, to close at 6,660.42, dragged down by steep losses in HSBC Holdings Plc (0005.HK) which fell HK$6.00, or 3.82 percent, to HK$151.00. ''The situation in Russia adds more anxiety to the currency concerns here,'' said Ben Kwong, head of research at Dharmala Securities, adding investors were still mainly concerned with the Japanese yen and the Chinese and Hong Kong currencies. Thursday's close was the lowest since April 1993. During the morning, the Hang Seng Index fell to a session low of 6,581.44, its lowest point since April 13, 1993, when it hit 6,286.67. Russia's distraught economy prompted international financier George Soros to propose a devaluation of the rouble and peg to the U.S. dollar or euro. Russia's deputy central bank chairman Denis Kiselyov said the proposal would not solve the country's financial crisis. Kwong said: ''There could be a similar type of situation like Hong Kong. Speculators or hedge funds could make use of the unstable economic situation there as an excuse to attack the currency.'' Hong Kong's interbank rates rose on Thursday in response to news of Russian economic instability. The benchmark three-month interbank rate firmed to 11.70-12.25 percent on Thursday against 11.00-11.50 percent on Wednesday. Antony Mak, sales director at Vickers Ballas, said investors were taking short positions against the Hong Kong dollar ahead of the long weekend. Monday is Sino-Japanese War Victory Day, a market and public holiday in Hong Kong. ''Speculators on the Hong Kong dollar still have not gone away, and there is talk they will come back in full force next week,'' Mak said. Hang Seng Index August futures lost 230 points to 6,610 and the September contract shed 200 points to 6,660 points. Analysts said investors were still eyeing the yen after it soared to 147 against the U.S. dollar on Tuesday. It was trading at a firmer 146.15/25 on Thursday afternoon. Investors were also worried about the stability of the Chinese yuan and the Chinese economy as flooding threatened the country's ability to reach its 8.0 growth target for the year. However, China plays were quiet, with the red chip Hang Seng China-Affiliated Corporations Index dropping 2.37 points, or 0.40 percent, to 592.18, while the H-share index edged up 0.16 point, or 0.06 percent, to close at 275.50. HSBC Holdings hit a year low of HK$148.50 during the session and accounted for 78.19 points of the Hang Seng Index's decline by the close. Analysts said the stock was being rerated after its disappointing first-half earnings. Property stocks were targeted ahead of their earnings reports. Cheung Kong (0001.HK) is due to report its interim results later this month and fell HK$1.03 to HK$28.85. Shares in Sun Hung Kai Properties (0016.HK) slumped HK$0.90, or 4.0 percent, to HK$21.60. Among the big losers, TVB (0511.HK) lost HK$1.45, or 9.06 percent, to close at HK$14.55. Utility CLP Holdings (0002.HK) fell HK$0.80, or 2.59 percent, to HK$30.10 and Hongkong Electric (0006.HK), which released its interim results after the close, fell HK$0.25, or 1.15 percent, to HK$21.45. But China Telecom (0941.HK) gained HK$0.30, or 3.33 percent, to HK$9.30. Market turnover was HK$5.14 billion compared with HK$5.55 billion at Wednesday's close. * Reuters Terminal users can see related news by double clicking on: (HK) (STX) * For index, major highlights double click on: (HK/MENU) HK stocks menu (0#.INX.HK) All Hang Seng indices (^HSI - news) Hang Seng index (0#.HSI) Hang Seng index components (^HSCC - news) Red-chips index (0#.HSCC) Red-chips index components (^HSCE - news) H-shares index (0#.HSCE) H-shares index components (.AV.HK) Top 20 by volume (.AM.HK) Top 20 by turnover (.NG.HK) Net gain leaders (.PG.HK) Percentage gain leaders (.NL.HK) Net loss leaders (.PL.HK) Percentage loss leaders (0#HSI:) Hang Seng index futures (HFE/FUTEX1) Futures contracts prices and contract details (HKG/OPTEX1) Options contracts prices and contract details (HK/HOT) HK Hot Stocks Highlights (SZ/MENU) Shenzhen stocks menu (SS/MENU) Shanghai stocks menu

To: EPS who wrote (6604)	8/13/1998 7:16:00 AM
From: Oracle	Read Replies (1) \| Respond to of 22640

FOCUS-Russia markets slump, bank stands by rouble By Irina Demchenko MOSCOW, Aug 13 (Reuters) - Russia's stock market plunged in early dealings on Thursday as the central bank rejected a call by financier George Soros to devalue the rouble and insisted its present policies would help avert a banking crisis. ''This is Black Thursday for the Russian financial markets,'' ORT state-owned television said in its midday bulletin after the authorities had suspended share trading for 35 minutes when stock prices fell by some 15 percent in early dealings. The Reuters composite index (.RRC1) was down 14.88 percent at 0830 GMT at 62.44 in thin trade. Yields on short-dated treasury bills soared to 135-167 percent as dealers dumped paper to acquire roubles. The rouble itself edged lower. ''A one-off devaluation of 15-25 percent would not solve a single one of the problems facing the Russian government,'' central bank deputy chairman Denis Kiselyov told Reuters after Soros suggested the idea in Thursday's Financial Times. The bank also stepped in swiftly to restrict some commercial banks' access to hard currency and to extend credit to a wider circle of private banks after saying some Russian banks had problems making payments after selling roubles aggressively. ''Everything now depends on what the government and central bank do,'' ORT television said. ''Back in the USSR,'' headlined the business newspaper Kommersant Daily in English, warning of a further collapse in confidence and a weak rouble driving up import prices. ''Investors have completely lost confidence in the government,'' it said. ''We cannot rule out that imports could disappear and there will be limits on rouble convertibility.'' Russia's cash shortage has already deprived millions of workers of wages and driven some to stage protests and forced the government to take out foreign loans to avoid bankruptcy. The prospect that the crisis of confidence could now ravage the banking system is one that alarms governments abroad, which are anxious not to see growing political instability in Russia. The Hungarian-born Soros, who made a fortune speculating against sterling and other pegged European currencies in 1992, has invested in Russia and is an influential voice in financial markets thanks to the billions of dollars of funds he controls. But the central bank, which stepped in on Thursday to stave off a payments crunch among Russian commercial banks, said that the rouble's present corridor, based around a pivot of 6.2 per dollar, would help avert a short-term banking crisis. Kiselyov said Soros's idea would create opportunities for ''speculative games.'' The rouble, which is not fully convertible abroad, was at 6.3250 per dollar at 0800 GMT, down from 6.2960 a day earlier. Restrictions on trade limit daily movements but the rouble has fallen from 5.9 per dollar when the financial market crisis in Asia began to knock confidence in Russia last October. Relative currency stability and corresponding inflation of just over four percent a year compared to the four-digit digit inflation that following the collapse of communism in 1991 are the clearest economic achievements of President Boris Yeltsin. Widespread disillusion with the slump in living standards over the past seven years means the government of Prime Minister Sergei Kiriyenko, which is battling to balance its own books, is loth to relinquish that one yardstick of success by devaluing. Many economists have argued that Russia, which has no worrisome current account deficit, has no reason to devalue. Kiriyenko ruled it out once again on Wednesday. Soros said Russia should peg the rouble more firmly to the dollar or euro but at a lower rate than today to reflect the slump in the price of its main export, oil. Kiriyenko, a youthful reformer appointed by Yeltsin in March, won $22.6 billion in credits from the International Monetary Fund and other lenders last month. Had he not, the government might have been unable to repay existing debts. With yields on one-month government borrowing leaping to 135 to 167 percent from Wednesday's 28-55 percent range, the state's ability to keep honouring its debts is again being questioned. U.S. President Bill Clinton, who will visit Russia for a summit with Yeltsin on September 1-3, has been particularly vocal in supporting the new Kremlin team's efforts. But Washington is concerned at a crisis of confidence, which has already troubled Western financial markets. Clinton discussed Russia's problems with aides on Wednesday and the U.S. Treasury's undersecretary for international affairs, David Lipton, arrived in Moscow on Wednesday. Another central deputy chairman, Sergei Aleksashenko, conceded on Wednesday evening that the interbank credit market was suffering a lack of ready cash that was draining confidence. But he said: ''We intend to take under strict control, every minute and every hour, activities of the banks whose positions are causing serious suspicions of instability. We intend to prevent the interbank crisis from spreading further.'' --------------------------------------------------------------------------------