HK stocks fall as investors question China plan
AP - 2 hours 11 minutes ago
HONG KONG - Hong Kong's key stock index fell almost 5 percent Tuesday as investors questioned the impact of China's multibillion dollar stimulus plan and booked profits from the previos day's rally.
The blue-chip Hang Seng Index lost 703.73 points, or 4.8 percent, to 14,040.90.
The benchmark advanced 3.5 percent Monday as the market welcomed China's 4 trillion yuan ($586 billion) plan to gird its economy against slowing global demand.
"We were overexcited yesterday about the Chinese plan," said YK Chan, fund manager at Phillip Capital Management in Hong Kong.
"Investors are starting to think about the plan in details and wondering whether the plan will be effective enough and how (the government) will implement it," Chan said. "There are a lot of questions to be answered."
Developers took a beating.
Cheung Kong (Holdings) Ltd., Hong Kong's No. 2 property firm by market value, plunged 9.3 percent to HK$72. and Sino Land tumbled 9.5 percent to HK$6.5
In financials, shares of HSBC Holdings PLC slid 4.8 percent to HK$88 after the bank, Europe's largest by market value, announced $4.9 billion in writedowns for the third quarter, as bad loans in the U.S. continued to mount and the credit market faltered.
Hong Kong's interbank lending rate, known as Hibor, for three-month loans eased further, falling from 2.14 percent to 2.10 percent.
On the Net:
Stock Exchange of Hong Kong: http://www.hkex.com.hk
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