Hong Kong stocks close down 0.49%
Hong Kong stocks closed 0.49 percent lower Tuesday despite data indicating a surprise pick-up in Chinese manufacturing activity in September. The Hang Seng Index fell 118.42 points to 23,837.07 on turnover of HK$71.56 billion ($9.23 billion). The flash reading for HSBC's purchasing managers' index (PMI) of manufacturing activity for September came in at 50.5, up from 50.2 in August. Anything above 50 indicates growth and anything below means a contraction. Analysts had braced for a figure below 50 after a series of downbeat data, including on output and trade. "Economic activity in the manufacturing sector showed signs of stabilisation in September," HSBC economist Qu Hongbin said in a statement. "Overall the data still point to modest expansion. The property downturn remains the biggest downside risk to growth," Qu said. While the index got an initial bounce from the news, investors resumed selling. The market has taken a hit on concerns about China's economy, which is suffering from slowing growth. It sank on Monday after China's finance minister said at the weekend Beijing would not make any significant policy adjustments despite recent weakness. "Overall, today's slightly better-than-expected PMI provides little reason for cheer," BNP Paribas said, according to Dow Jones Newswires. "The pressure on the Chinese authorities to ease policy to shore up growth remains substantial." Henderson Land Development sank 1.38 percent to HK$53.60 and HSBC eased 0.84 percent to HK$82.85. Tencent fell 1.57 percent to HK$119.2 and Hong Kong Exchanges and Clearing lost 0.34 percent to HK$174.6, although China Mobile added 0.69 percent to HK$95.45 and Sinopec was 1.16 percent higher at HK$6.97. However, in China the benchmark Shanghai Composite Index rose 0.87 percent, or 19.85 points, to 2,309.72 on turnover of 135.4 billion yuan ($22.1 billion). The Shenzhen Composite Index, which tracks stocks on China’s second exchange, gained 1.25 percent, or 15.90 points, to 1,291.42 on turnover of 162.0 billion yuan. "The data showed an improvement and there's still room for the government to introduce measures to stabilise the economy," Zheshang Securities analyst Zhang Yanbing told AFP. Media reports that China’s big four banks might relax some requirements for mortgage loans also supported the market, analysts said. In Shanghai, Poly Real Estate rose 1.27 percent to 5.59 yuan while developer Gemdale gained 0.48 percent to 8.42 yuan. Banks were mixed in Shanghai after the report. Agricultural Bank of China added 0.41 percent to 2.46 yuan and Bank of China rose 0.37 percent to 2.68 yuan. Defence stocks gained on speculative buying. Tianhe Defence Technology soared by its 10 percent daily limit to 81.66 yuan in Shenzhen while Beijing Aerospace Changfeng jumped 4.53 percent to 21.70 yuan in Shanghai.
