Hong Kong: Stocks end lower after Fed's surprise turn

[SHANGHAI] Hong Kong stocks fell on Monday, largely in line with other Asian markets, as investors pondered the implications of the US Federal Reserve's surprise hawkish shift last week.

At the close of trade, the Hang Seng index was down 312.27 points or 1.08 per cent at 28,489.00. The Hang Seng China Enterprises index fell 0.93 per cent to 10,547.86.

The sub-index of the Hang Seng tracking energy shares dropped 0.9 per cent, the IT sector slipped 1.2 per cent, the financial sector ended 1.89 per cent lower and the property sector fell 1.16 per cent.

The top gainer on the Hang Seng was AAC Technologies Holdings, which gained 5.15 per cent, while the biggest loser was Haidilao International Holding, which fell 5.06 per cent.

Around the region, MSCI's Asia ex-Japan stock index was weaker by 1.07 per cent, while Japan's Nikkei index closed down 3.29 per cent.

US St Louis Federal Reserve President James Bullard said on Friday that the US central bank's shift towards a faster tightening of monetary policy was a "natural" response to economic growth and particularly inflation moving quicker than expected as the country reopens from the Covid-19 pandemic.

China kept its benchmark lending rate for corporate and household loans unchanged for the 14th straight month at its June fixing on Monday, in line with market expectations.

The Financial News, backed by the Peoples Bank of China, on Sunday advised against speculating about liquidity tightening and policy direction, saying such action can mislead and roil markets.

China's main Shanghai Composite index closed up 0.12 per cent at 3,529.18 points, while the blue-chip CSI300 index ended down 0.24 per cent.

The yuan was quoted at 6.468 per US dollar at 8.10am, 0.22 per cent weaker than the previous close of 6.4537.

At close, China's A-shares were trading at a premium of 38.11 per cent over Hong Kong-listed H-shares.

REUTERS