Hong Kong stocks slip as investors turn defensive after 4-month rally amid fading US rate-cut bets
- Today’s decline in the city’s stocks took the week’s loss to 3.6 per cent in a slump that has wiped out over US$100 million in value
- Lack of positive earnings surprises and hawkish comments from US Federal Reserve officials further soured risk appetite
The Hang Seng Index fell 1.4 per cent to 18,608.94 at the closing of Friday trading, the fourth straight day of declines that took the benchmark to a two-week low. The Tech Index tumbled 2.5 per cent, while Shanghai Composite Index lost 0.9 per cent.
All but eight of the 82 index members declined. Tencent lost 1.3 per cent to HK$377, e-commerce firm JD.com retreated 3.3 per cent to HK$119.60 and food delivery platform Meituan lost 2.7 per cent to HK$116.30. New World Development lost 3.4 per cent to HK$9.13, Hang Lung Properties weakened 4.3 per cent to HK$7.64 and Hang Seng Bank slipped 2 per cent to HK$110.10, leading declines among local lenders and developers.
Sentiment took another hit on Friday after US business activity accelerated in May, with the US Composite PMI Output Index tracking the manufacturing and services sectors jumped to 54.4. Bets on Fed rate cuts waned with virtually no chance of a cut at the June meeting, according to CME Fedwatch Tool, a barometer tracking the markets expectation of potential changes to the fed funds target rate.
Today’s decline brought the losses this week to 4.8 per cent, the worst weekly loss since January, in a slump that has wiped out over US$100 million in value from the city’s stocks, according to Bloomberg data.
