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Hong Kong Market falls on China COVID outbreak, US midterm results

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Capital Market
Last Updated : Nov 10 2022 | 2:50 PM IST
Hong Kong share market finished lower for third straight session on Thursday, 10 November 2022, on following the broadly negative cues from Wall Street overnight, following inconclusive U.S. midterm election result with an unexpectedly tight race between Democrats and Republicans and on caution before U.S. inflation data due out later in the day.

Meanwhile, selloff pressure intensified amid growing concerns over China economic slowdown as the world's second-largest economy again grappling with a COVID surge, with the southern metropolis of Guangzhou reporting thousands of cases.

At closing bell, the benchmark Hang Seng Index dropped 277.48 points, or 1.7%, to 16,081.04. The Hang Seng China Enterprises Index was down 117.63 points, or 2.13%, to 5,417.13.

Overnight on Wall Street, shares ended lower as uncertainty around the outcome of a tightly contested election as the GOP's midterm 'red wave' failed to materialize. Control of both houses of Congress remains up for grabs following yesterday's elections, although Republicans are projected to earn a narrow majority in the House. The performance by Republicans was not as strong as many had expected, with many candidates backed by former President Donald Trump underperforming. It remains unclear which party will have a majority in the Senate, as key races in Georgia, Nevada and Arizona currently remain undecided.

Persistent COVID disruptions and mobility restrictions have hurt China's domestic demand and weighed on the world's second-largest economy, with the International Monetary Fund cutting China's full-year growth forecast to 3.2% from 4.4% previously.

China reported 9,005 new COVID-19 infections for Nov. 9, including both symptomatic and asymptomatic cases, compared with 8,335 new cases a day earlier. In China's southern manufacturing hub of Guangzhou, millions of residents are being tested for COVID-19 in a fight against city's worst outbreak so far.

Apple Inc supplier Foxconn plans to update its fourth-quarter outlook on Thursday, after strict COVID curbs remained in place at its major plant in China despite the lifting of a lockdown.

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Traders continued to look ahead to report on US consumer price inflation data due later in global day which would give clues about how much the U.S. Federal Reserve's rapid interest rate hikes are helping cool down the economy.

Among HK blue chips, Alibaba Group lost 4.6% to HK$63. Tencent fell 2.3% to HK$231.40 while JD.com slipped 3.7% to HK$165.80. Geely Auto weakened 5.6% to HK$9.74 and car dealer Zhongsheng slumped 3.5% to HK$34.65. Shenzhou International tumbled 4.5% to HK$56.95. AAC Technologies jumped 4.6% to HK$17.40.

Property management firm Country Garden Services gained 0.7% to HK$10.90 after agreeing to buy a 21.5% stake in real-estate agency Hopefluent Group for HK$233.1 million. Hopefluent slid 7.4% to HK$1.12.

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First Published: Nov 10 2022 | 2:42 PM IST

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