At closing bell, the benchmark Hang Seng Index declined 1.08%, or 312.27 points, to 28,489. The Hang Seng China Enterprises Index dropped 0.93%, or 98.53 points, to 10,547.86.
The sub-index of the Hang Seng tracking the commerce & industry sector dropped 0.47%, utilities sector fell 1.86%, the properties sector fell 1.16%, and the finance sector fell 1.89%.
Risk aversion selloff triggered in the major benchmarks in Asia amid fears of a possible U.S. interest rate hike next year following remarks from a Federal Reserve official late last week. Rattling the nerve of traders was the comment by St Louis Fed president James Bullard, who told that interest rates may move higher next year on inflation risks. His rhetoric was harsher than the earlier projection by other Fed officials who projected that the increase in borrowing costs will probably come in 2023. Fed chairman Jerome Powell said last week that the US central bank had begun to mull curtailing bond purchases, but discussion about raising interest rates was still premature.
Stocks set to thrive on the economic recovery bore the brunt of the sell-off. Chinese hotpot chain restaurant operator Haidilao International Holding sank 5.1% to HK$37.50 and property developer Longfor Group Holdings fell 4.4% to HK$42.90. HSBC Holdings lost 3.5% to HK$45.55.
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