Hong Kong stocks declined, with the benchmark index sliding to an almost two-week low, as gaming shares and Tencent Holdings Ltd. slumped.
Galaxy Entertainment Group Ltd. (27), a casino operator controlled by billionaire Lui Che-woo, tumbled 6.4 percent and Sands China Ltd. plunged 5.8 percent amid Macau’s weakest monthly growth in mass market revenues since at least 2010. Tencent fell 3.5 percent after Xinhua reported the Chinese government is tightening regulation on instant messaging services. China Unicom (762) (Hong Kong) Ltd., the mainland’s second-largest mobile carrier, fell 1.5 percent ahead of reporting earnings after the close.
The benchmark Hang Seng Index (HSI) dropped 0.8 percent to 24,387.56 at the close in Hong Kong, the lowest since July 25. The Hang Seng China Enterprises Index (HSCEI) of mainland shares traded in the city, also known as the H-share index, lost 0.9 percent to 10,876.61.
“Hong Kong has turned to consolidation mode,” said Jackson Wong, vice president at Tanrich Securities Co. in Hong Kong. “Casinos are still in a weak trend until their operational data improves.”
The H-share gauge has fallen for three days as investors took profits after the measure surged more than 20 percent from its March low and entered a so-called bull market last week. The gauge trades at 7.6 times estimated earnings, compared with 11.3 for the Hang Seng Index today and 16.1 for the Standard & Poor’s 500 Index (SPX) yesterday.
China is scheduled to release July trade data tomorrow, with economists forecasting 7 percent growth in exports and 3 percent expansion in imports. That compares with 7.2 percent and 5.5 percent growth the previous month, respectively. A private gauge of the nation’s services industry fell to a record low, data showed this week.
China will promote mixed-ownership reform for state-owned banks, the National Business Daily reported, citing China Banking Regulatory Commission Chairman Shang Fulin.
Futures on the S&P 500 rose 0.2 percent today. The U.S. benchmark index closed flat yesterday as declines in Sprint Corp. and Time Warner Inc. on failed deals offset gains in consumer-staples shares.
Galaxy declined 6.4 percent to HK$59.40 and Sands China Ltd. (1928), a unit of Las Vegas Sands Corp., retreated 5.8 percent to HK$52.35, leading the Hang Seng Index lower.
Macau’s July monthly casino revenue breakdown, released late yesterday, showed the mass market growing 17 percent from a year ago, “the lowest result since we started tracking the data in 2010,” Cameron McKnight, a U.S.-based analyst at Wells Fargo & Co., wrote in a note today.
Tencent (700), Asia’s largest Internet company, slid 3.5 percent to HK$128.30, its biggest drop since May 7. China said instant messaging applications including Tencent’s WeChat need to get a permit to provide public information services and that it will require new registrants to use real names, according to a report published by Xinhua today.
Semiconductor Manufacturing International Corp. lost 6.9 percent to 67 Hong Kong cents after its second-quarter profit missed analyst estimates.
China Unicom fell 1.5 percent to HK$12.80. The company slumped 5.3 percent yesterday after China International Capital Corp. said its second-quarter earnings may miss consensus on slower subscriber growth.
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