Hong Kong Stock Rout Driven by Structured Products, Traders Say
- City’s benchmark stock gauge tumbled as much as 4.2% Wednesday
- Losses triggered liquidation, stop-loss orders: Bright Smart
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Hong Kong’s biggest stock slide in more than a year Wednesday was probably exacerbated by the triggering of automatic sell orders on structured products, according to several traders and analysts.
The Hang Seng Index slid from Wednesday’s open following worse-than-expected Chinese economic data, before the breaching of technical levels triggered knock-outs on a number of retail structured products, they said, with some requesting anonymity to discuss sensitive market matters. The benchmark gauge at one stage tumbled 4.2%.