23 March 2019

Stocks pause but HKEx soars on cross-border trading link

Hong Kong stocks took a breather Friday as investors grabbed profits from previous trading sessions.

The benchmark Hang Seng Index lost 183 points, or 0.79 percent, to 23,003. It gave up 2 percent for the week. The Hang Seng China Enterprises Index, the main gauge for H shares, ended 1.85 percent lower at 10,228.

The Shanghai Composite Index slipped 0.18 percent to end at 2,130 points.

Meanwhile, stock exchange operator Hong Kong Exchanges and Clearing (HKEx) (00388.HK) surged above 11 percent after it resumed trading on the back of Thursday’s landmark announcement about a “through train” trading scheme with its Shanghai counterpart. It was the day’s best performing blue chip.

The scheme allows investors in the two exchanges to invest in each other’s market. On Friday, it brought the first signs of a narrowing gap in stock valuations between the two sides.   

New-economy stocks got a jolt from tech-heavy NASDAQ which tumbled 3 percent overnight, its worst finish in more than two years, sending related counters in Asia off kilter.

Tencent (00700.HK) slumped 6.75 percent, the worst hit among blue chips. Technology service provider Hi Sun Technology China (00818.HK) tumbled nearly 10 percent and Kingsoft (03888.HK) lost 6.1 percent. 

Mainland insurance plays were previously trading at a premium in Hong Kong. With the mutual market access deal, H-share insurance stocks experienced heavy selling pressure. China Life Insurance (02628.HK) saw 5.3 percent wiped off its value and Ping An Insurance (02318.HK) blew 4.9 percent.

However, high-flying stocks in the previous session retreated significantly. Automobile parts maker Zhejiang Shibao (01057.HK, 002703.CN) slumped 11 percent after rising 64 percent on Thursday. Northeast Electric Development (00042.HK, 000585.CN) slipped 10.5 percent for the day.

– Contact the writer at [email protected]



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