Hong Kong Stocks Plunge

123jump.com Staff
07 Mar, 2008
New York City

Hang Seng fell 3.6% and closed down 7.5% for the week after the weakness in global markets dragged banks and energy companies. China Enterprise Index fell 9.5% for the week. China Netcom and Sun Hung Kai fell after brokers lowered their ratings on stocks.

[R]6:00AM New York, 6:00PM Hong Kong - Hong Kong down 7.5% for the week.[/R]

Stocks in Hong Kong closed the week in negative territory on resurgent subprime fears ignited by record increases in U.S. foreclosures and reports by JP Morgan Chase & Co that UBS could have more write-downs.

In Hong Kong trading Hang Seng Index dropped 3.6% or 841.40 at 22,501.33, a 7.5% slump for the week, and the China Enterprises index of H shares, or Hong Kong listed shares in mainland companies, fell 3.5%, or 459.06 at 12,606.83, and slipped 9.5% for the week.

Daily turnover was on main-board was HK$83.0 billion compared to HK$69.6 billion yesterday.

U.S. foreclosures rise to 0.83% in Fourth Quarter

Mortgage Bankers Association said 0.83% of all mortgages across the United States entered in foreclosure between in the fourth quarter, up from the previous high of 0.78% in the third quarter.

The association added that 5.82% of all mortgages were in delinquency in the fourth quarter, the highest since 1985.

In addition, late payments in the subprime sector rose 20.02% in the October-December period, from 18.81% in the third quarter, while fourth quarter foreclosure rate in the subprime sector rose to 5.29% from 4.72% in the previous quarter.

Chinese property prices increase 11.3% in January

Xinhua News Agency reported today the National Development and Reform Commission said today that property prices in major Chinese cities in January rose 11.3% from a year ago.

The average rise for the 70 large and medium-sized cities was 0.8% higher than the rise in December, while prices rose 0.3% in January from the previous month.

Prices for newly built apartments soared 12.2% from a year ago, while prices for older flats rose 11.9%.

Urumqi, capital of the northwestern Xinjiang Uygur Autonomous Region, recorded the fastest increase at 25%, followed by Nanning, the southern Guangxi Zhuang Autonomous Region capital, at 20.3%. In addition, Beijing increased 17.2%, while Shanghai rose 10.1%.

Beijing Hotel Rooms Rise between four to ten times for Olympics

The People’s Daily Online reported today that China''s largest online booking provider Ctrip.com International Ltd. said quoted prices for hotel stays in Beijing during the summer Olympics have climbed by four to ten times higher than normal.

Beijing is gearing up to accommodate about 500,000 foreigners during the Games, along with huge numbers of domestic tourists.

Ctrip.com added that hotel prices in Beijing Olympics'' co-host cities, such as Qingdao and Shenyang will rise by 30% to 40%, while the east China coast city of Qingdao, which is also a popular beachside resort city in summer, will see price rises of 50% to 100% higher than normal days during the Games.

Gainers & Losers

Financial stocks fell after the JP Morgan Chase & Co said that the investment bank UBS probably sold 25 billion francs of mortgage-backed securities in a ``fire sale ''''. HSBC fell 3.4% to HK$117.40 on the report.

Sinopec dropped 7.7% to HK$7.56 after Goldman Sachs downgraded the stock to “neutral” from “buy”, saying profits might be affected as prices of domestic refined products are below projected oil price increases.

Honghua closed below the middle of its indicated range at HK$3.5.The company raised US$409 million at its public offering.

Hong Kong Exchanges and Clearing fell 4.5% to HK$136.7 after reporting its results yesterday.

Property developer SOHO China fell 3.7% to HK$5.2 on Reuters news that quoted HSBC report that the company’s acquisition of 11 Qianmen parcels were in question after three of them were returned to government hands.