HK stocks plunge 5.9% on failed US auto bailout

(Xinhua)
Updated: 2008-12-12 20:17

HONG KONG -- Hong Kong stocks pared part of its steep losses but still plunged 855.51 points, or 5.9 percent, to close at 14,758.39 on Friday after the bailout package for the US auto industry was rejected in the Senate.

The benchmark Hang Seng Index fell 326.2 points, or 2.09 percent, to open at 15,287.7 and once moved to the day's highest 15,393.09 in the morning session.

As the US Senate rejected the US$14-billion bailout package for the auto industry, sensitive investors reacted quickly in the Hong Kong market when trading was on for about one and a half hours, dumping shares and taking profits from previous rallies.

The index dived as much as 1,134.67 points, or 7.27 percent, to the day's lowest 14,479.23 in the morning session.

Bargain-hunting investors scooped up the shares of some blue chip companies when trading was resumed in the afternoon session, trimming the market's losses to close at 14,758.39.

Turnover fell to 58.77 billion HK dollars (US$7.59 billion) from Thursday's 61.42 billion HK dollars (US$7.93 billion).

Steep drops were across the board as all 42 components of the benchmark Hang Seng Index were under selling pressure.

Market heavyweight HSBC, which accounts for the largest weighting of the index, slumped 5.73 percent to 82.25 HK dollars, dragging down the index by 127.88 points alone.

Another market giant China Mobile, the country's largest telecommunications operator or the market's top company measured by capitalization, sank 4.68 percent to 78.5 HK dollars, dampening the index by 100.93 points.

Hong Kong Exchanges and Clearing Ltd., the market's sole operator, lost 5.55 percent to 73.2 HK dollars.

Local property companies in Hong Kong were all lower. Sun Hung Kai, Hong Kong's largest house developer, weakened 7 percent to 61. 85 HK dollars. Cheung Kong, one of Hong Kong's largest housing companies controlled by tycoon Li Ka-shing, fell 6.81 percent to 78 HK dollars. Henderson Land slumped 8.08 percent to 29 HK dollars. New World Development plunged 11.07 percent to 6.83 HK dollars. Sino Land sank 6.29 percent to 7.6 HK dollars. Hang Lung Property was down 5.44 percent to 17.72 HK dollars.

H-shares, which reflect the performance of 42 companies registered in the Chinese mainland, tumbled 574.69 points, or 6.77 percent, to close at 7,911.76. Selling pressure for all 42 H- shares companies was huge, sending the index below the 8,000 mark again.

China's energy companies were all lower as concerns over weakening global demands outweighed the price upsurge of crude oil overnight. PetroChina, the country's largest oil producer, tumbled 7.58 percent to 6.71 HK dollars. CNOOC, China's largest offshore oil company, lost 6.12 percent to 7.21 HK dollars. Sinopec, Asia's largest oil refiner, was down 7.42 percent to 4.99 HK dollars.

Banks and insurers of China all fell. ICBC, China's largest lender, was down 4.05 percent to 4.27 HK dollars. Bank of China, the country's second largest bank, lost 3.08 5.16 percent to 2.39 HK dollars. China Construction Bank, the third largest bank in the country, slumped 5.94 percent to 4.59 HK dollars. Bank of Communications dropped 6.8 percent to 5.48 HK dollars. China Merchants Bank sank 8.43 percent to 15.2 HK dollars. China Life, the country's top insurance company, was down 6.3 percent to 23.05 HK dollars. Ping An dropped 6.74 percent to 35.95 HK dollars. ( 7.742 HK dollars = US$1)