Hong Kong stocks fell, with the benchmark index posting a second day of declines, as casinos slipped and Tencent Holdings Ltd. dropped amid a global selloff in technology shares.
Tencent, Asia’s biggest Internet company, slumped 4.5 percent to its lowest close in more than two months. Galaxy Entertainment Group Ltd., the Macau gaming company that posted the biggest advance on the Hang Seng Index in the past 12 months, dropped 5.6 percent. Cnooc Ltd. rose 1.7 percent as China’s biggest offshore oil producer was said to be considering selling its stake in Argentina’s Bridas Corp.
The Hang Seng Index slid 0.6 percent to 22,377.15 at the close. The Hang Seng China Enterprises Index, also known as the H-share index, added 0.5 percent to 10,156.89. Mainland markets were closed for a holiday.
“We’ll continue to see range-bound trading in Hong Kong,” Pauline Dan, who helps manage $153 billion as Hong Kong-based head of greater China equities at Pictet Asset Management Ltd., said by phone. “We may be getting close to a more meaningful trough as the market has been pricing in a lot of negatives. Investors are waiting for clearer policy measures from China before the market could have a more sustainable rally.”
The Hang Seng Index was the second-worst performer among developed markets this year through April 4, even after the measure rose the past two weeks as U.S. data pointed to a recovery from severe winter weather and China outlined stimulus plans. The gauge traded at 10.3 times estimated earnings today, compared with 15.9 times for the Standard & Poor’s 500 Index last week.
Futures on the S&P 500 slipped 0.4 percent today. The U.S. equities benchmark index declined 1.3 percent on April 4, with the Nasdaq Composite Index sliding the most in two months, after the largest technology stocks from Google Inc. to Yahoo Inc. plunged as investors sold the bull market’s biggest winners.
Payrolls in the U.S. rose 192,000 last month after a 197,000 gain in February that was larger than first estimated, the Labor Department reported April 4 in Washington. The median forecast in a Bloomberg survey of economists projected a 200,000 gain. Private employment, which excludes government jobs, surpassed the pre-recession peak for the first time.
Pacific Investment Management Co.’s Bill Gross said the pace of employment growth in the U.S. means the Fed will continue to wind down bond purchases and then consider raising interest rates.
Tencent slipped 4.5 percent to HK$501.50, the biggest drag on the Hang Seng Index today. The shares have fallen 21 percent from an all-time closing high of HK$635 on March 6 amid growing concern that valuations overshot earnings prospects.
Mark Mobius, who oversees about $50 billion at Templeton Emerging Markets Group, said he’s been buying technology stocks after a global rout left companies such as Tencent trading at “reasonable” levels.
“If you look at Tencent for example it’s come down about 20 percent and that’s a pretty good correction,” Mobius said in an interview in Bloomberg’s Hong Kong office, declining to name specific companies he’s buying.
Casino shares declined. Galaxy dropped 5.6 percent to HK$67.95, the most since Feb. 5. Sands China Ltd., the Macau casino unit of billionaire Sheldon Adelson’s Las Vegas Sands Corp., slid 4.9 percent to HK$60.25.
Sands China is increasing scrutiny of Macau junket operators, who bring wealthy gamblers from mainland China. The middlemen are being asked to provide more information about their businesses to Sands as the company seeks to bolster its safeguards against money laundering and other wrongdoing, a person familiar with the matter said last week. The changes are likely to reduce the number of junket operators working with Sands, said the person, who asked not to be named because the moves aren’t public.
Among shares that rose, Cnooc climbed 1.7 percent to HK$12.22. The company is considering the sale of its stake in Bridas to free up money for other projects, according to people with knowledge of the deliberations. Cnooc bought 50 percent of Bridas for $3.1 billion in 2010, while the rest is owned by Argentina’s billionaire Bulgheroni brothers.