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Hong Kong: Shares tumble in early trade
[HONG KONG] Hong Kong and Shanghai shares tumbled in opening deals on Monday, extending heavy losses amid a global sell-off as concerns about China's economy deepened despite Beijing's fresh efforts to shore up Chinese equities.
Hong Kong's benchmark Hang Seng Index dropped more than four percent in the first minutes of trading before recovering to a loss of 3.89 per cent, or 871.02 points, to 21,538.6.
The losses came as the Shanghai Composite Index slumped 5.14 per cent, or 180.44 points, to 3,327.30.
The Shenzhen Composite Index, which tracks stocks on China's second exchange, plunged 5.51 per cent, or 112.32 points, to 1,927.08.
Global equities markets have seen more than US$5 trillion wiped off their value since China's shock devaluation of the yuan on August 11 sparked fears the world's second-largest economy is weaker than thought.
Wall Street saw heavy falls on Friday, with the Down Jones Industrial Average posting its worst single-day session in four years and all benchmark indices losing over three per cent.
"The market is going to drop further. It's normal as the markets across the whole world are falling," Qian Qimin, an analyst from Shenwan Hongyuan, told AFP.
In China, investors are also concerned government efforts to shore up equities will not be enough, even after news on Sunday that China's huge state pension fund will be allowed to invest in stocks.
"Financial risk will likely rise quickly, dampening market sentiment," Ken Chen, KGI Securities analyst, told Bloomberg News.
"Government intervention won't be able to stop the market correction in the long run."