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Hong Kong stocks follow China market higher amid yuan depreciation concern

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[HONG KONG] Hong Kong stocks firmed on Monday, led by buoyant mainland markets, but gains were capped by concerns over continued yuan weakness and the possibility of a US rate hike in December.

The Hang Seng index rose 1.0 per cent, to 23,604.08, while the China Enterprises Index gained 1.7 per cent, to 9,852.90 points.

China's yuan slipped to 6-year lows on Monday morning, but stabilised as large state-owned banks sold dollars in an apparent effort to slow the yuan's decline.

But analysts expect a possible US rate hike in December would strengthen the dollar further, put more pressure on the yuan, and lure liquidity away from emerging markets.

sentifi.com

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Most sectors in Hong Kong rose, with energy and financial shares among the best performers.

Hong Kong-listed shares in Nanjing Panda Electronics plunged as much as 16.9 per cent, after the company said it had scrapped a restructuring plan aimed at improving profitability.

REUTERS

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