Hong Kong Stocks Slide From Highest Level Since DecemberKana Nishizawa
Hong Kong’s benchmark stock index slid after yesterday closing at its highest this year, with Li & Fung Ltd. the biggest drag on the market.
Want Want China Holdings Ltd., a maker of snacks and beverages, fell 3.4 percent. Li & Fung, the world’s largest supplier of clothes and toys to retailers, tumbled 10 percent after the stock traded without rights to the company’s spinoff. Anhui Conch Cement Co. surged 5.6 percent after China’s biggest producer of the building material said it expects a 90 percent surge in first-half profit.
The Hang Seng Index lost 0.1 percent to 23,531.44 at the close in Hong Kong after yesterday ending at its highest level since Dec. 10. Trading volume today was 26 percent lower than its 30-day average. The Hang Seng China Enterprises Index, also known as the H-share index, added 0.1 percent to 10,454.27 after gauges of services sector activity were released today.
“China’s data has been improving in the past few months, which means the economy is headed for a soft landing,” said Louis Tse, a Hong Kong-based director at VC Brokerage Ltd. “Hong Kong stocks rose sharply yesterday and it may take a short-term breather before testing another high.”
The Hang Seng Index jumped the most in seven weeks yesterday after China’s official gauge of factory activity accelerated at the fastest pace this year. The central bank has cut reserve ratios for some lenders and outlined spending amid efforts to stabilize the economy.
A China services purchasing managers’ index released by HSBC Holdings Plc and Markit Ltd. today reached the highest since March 2013, with a reading of 53.1 for June from 50.7 the month before. The official non-manufacturing gauge fell to 55 last month from 55.5 in May, with figures above 50 indicating growth.
Li & Fung dropped 10 percent to HK$10.44. Yesterday was the last day for holders of the stock to be entitled to shares of the company’s spinoff. The parent said Global Brands Group is expected to start trading in Hong Kong on July 9.
Want Want dropped 3.4 percent to HK$10.86. PetroChina Co. slid 1.2 percent to HK$9.81 as energy companies led declines on the Hang Seng Composite Index.
Anhui Conch jumped 5.6 percent to HK$29.10 after saying it expects net income to jump from a year earlier on higher sales volume and prices.
China Overseas Land & Investment Ltd. rose 1.7 percent to HK$19.92 as property companies rose the most on Hong Kong’s benchmark index. China Resources Land Ltd., the second-biggest mainland developer listed in the city by market value, rose 2.2 percent to HK$14.68.
Futures on the S&P 500 were little changed. The underlying gauge rose less than 0.1 percent yesterday after reaching a record the day before. ADP Research Institute said U.S. companies last month added the most workers since 2012, beating the median estimate of economists in a Bloomberg survey. Official payrolls data are due today ahead of the U.S. Independence Day holiday.