Hong Kong stocks on Wednesday opened low and ended lower due to clouds over the U.S. economy and inflation concerns on China's mainland.
The benchmark Hang Seng Index opened at 28,611.64 points, tumbling 615.2 points, or 2.1 percent, and losing the ground it had gained in the previous session.
The key barometer moved between 28,343.21 and 28,777.28 on a turnover of 117.27 billion HK dollars (15.05 billion U.S. dollars), up from less than 100 billion Tuesday.
The market closed at 28,521.06, down 705.78 points, or 2.41 percent and widening its losses from the morning.
The losses were accounted for by the less-than-expected rate cut by 0.25 percentage points, on the one hand, and by tightening expectations from China's mainland, on the other.
Some of the investors had expected a rate cut by 0.5 percentage point, analysts said, adding that the worst was yet possibly to be expected as the extent to which the subprime fallout would slow down the U.S. economy remained to be seen.
The U.S. markets, concerned over economic outlook next year, fell overnight.
The Hong Kong Monetary Authority on Wednesday followed the United States Federal Reserve to announce a rate cut by 25 basis points.
The Chinese central government released figures on Tuesday, showing a jump of 6.9 percent in consumer price index over a year earlier and drawing speculations that the government was likely to tighten monetary policies.
Analysts, and even government officials, said they expected uncertainties ahead in the Hong Kong stock market but, judging from the fact that consumption growth was to remain a strong drive over the next year, downside was limited.
Blue chips were mostly losers on Wednesday, with the financial shares and the property players suffering the most while consumer producers remained strong.
The heavyweight mainland mobile carrier China Mobile lost 2.5 HK dollars, or 1.72 percent, to close at 143 HK dollars while its competitor China Unicom went down 0.56 HK dollars, or 3.15 percent to close at 15.84 HK dollars.
HSBC was down 2.2 HK dollars, or 1.61 percent, at 134.5 HK dollars. Hang Seng Bank also dropped 4.7 HK dollars, 2.85 percent, at 160.2 HK dollars.
The finance sub-index went down 859.34 points, or 2.04 percent, to close at 41,289.53 while the utilities genre went down 894.8 points to 39,763.06.
Bank of China lost 0.07 HK dollars at 4.04 HK dollars while its local unit BOC Hong Kong went down 0.3 HK dollars, or 1.34 percent, to 22.1 HK dollars.
Bank of Communications, one of the major mainland state-owned commercial banks, lost 0.34 HK dollars, or 2.82 percent, to close at 11.74 HK dollars.
Mainland banking giant ICBC lost 0.13 HK dollars to 6.05 HK dollars.
China Life went down 0.85 HK dollars, or 1.93 percent, to 43.1 HK dollars.
The properties category suffered the most, down 1,143.26 points, or 2.95 percent, to close at 37,613.18, followed by the commerce and industry stocks, which fell by 462.92 points, or 2.66 percent, to close at 16,936.92.
The blue-chip MTR Corporation, however, bucked the trend to rise 0.1 HK dollars to 28 HK dollars, which analysts said were supported by government injections of multibillion capital earlier and brighter earnings prospect.
Cathay Pacific Airlines was the only blue chip to remain unchanged during the session.
Investors were obviously in favor of mainland consumer products manufacturers, like local sportswear brand Li Ning, up 0.35 HK dollars at 26.8 HK dollars, and Mengniu Dairy, up 0.7 HK dollars, or 2.56 percent, at 28 HK dollars.
(Xinhua News Agency December 13, 2007)
