Hong Kong Stocks Fall for First Time in Four Days, Led by Banks
By Hanny Wan
Feb. 15 (Bloomberg) — Hong Kongs stocks fell for the
first time in four days, led by banks, after Goldman, Sachs %26amp;
Co. cut its rating on the industry to “cautious from
“positive.
Bank of East Asia Ltd. slumped the most in three weeks.
Shares also declined after U.S. Federal Reserve Chairman Ben S.
Bernanke said tighter credit dented growth in the worlds
largest economy. Foxconn International Holdings Ltd., the
worlds biggest contract manufacturer of handsets, dropped to a
three-week low.
“We will see slowing growth, which means decreasing
capital spending and economic expansion, and retail consumption
will suffer, said John Koh, who helps manage the equivalent
of $2.4 billion as regional investment director at MEAG Hong
Kong Ltd. For Hong Kong banks, “theres concern that their
short-term loan growth may not be good, Koh said.
The Hang Seng Index lost 425.99, or 1.8 percent, to
23,595.69 at the 12:30 p.m. break, paring its advance this week
to 0.5 percent. That would be the gauges first weekly gain in
six weeks. The benchmark has lost 15 percent this year amid
concern a U.S. recession will slow global growth.
The Hang Seng China Enterprises Index, which tracks “H
shares of Chinese companies, fell 0.8 percent to 13,436.93.
Ping An Insurance (Group) Co. fell after Chinas insurance
regulator said the countrys insurers have paid 1.04 billion
yuan ($145 million) in claims for the worst snowstorms since
1954.
Rating Cut
Bank of East Asia lost HK$2.15, or 5 percent, to HK$40.80,
its steepest decline since Jan. 28. Hong Kongs third-biggest
bank by assets reported during the lunchtime trading break that
its 2007 profit rose 21 percent to a record HK$4.14 billion
($531 million) as it extended more loans in the city and in
mainland China. Profit met the average HK$4.14 billion estimate
of nine analysts surveyed by Bloomberg News.
Hang Seng Bank Ltd., a unit of HSBC Holdings Plc, dropped
HK$3.40, or 2.5 percent, to HK$133.50.
Goldman cut its rating on Hong Kong banks as lower
interest rates squeeze margins and lending to small- and
medium-sized companies slows, analysts at the brokerage
including Roy Ramos said in a report today.
Goldman lowered its ratings on Bank of East Asia and Hang
Seng Bank to “neutral from “buy, according to the
research note.
Foxconn dropped 52 cents, or 4.2 percent, to HK$11.90, set
for its lowest close since Jan. 22. Deutsche Bank AG said the
company may get fewer orders from Motorola Inc. in the next six
to 12 months, prompting the brokerage to trim its profit
estimate for Foxconn in a Feb. 13 research note.
HSBC, Europes biggest bank, lost HK$3.10, or 2.7 percent,
to HK$113.10. The company generated 31 percent of its revenue
in 2006 from North America.
Lower Forecast
In the U.S., Bernanke said Fed officials have lowered
their forecasts for economic growth and policy makers are
prepared to cut interest rates further as the economy continues
to deteriorate.
Ping An, Chinas second-largest insurer, fell HK$1.55, or
2.7 percent, to HK$56. China Life Insurance Co., the No. 1,
declined 65 cents, or 2.2 percent, to HK$29.45.
Chinas insurers have received 851,000 snow-related claims
as of Feb. 12, Wu Dingfu, chairman of the China Insurance
Regulatory Commission, said today.
Thirty-six stocks on the 43-member Hang Seng Index
declined while seven climbed. February futures dropped 1.3
percent to 23,570.
The following stocks rose or fell. Stock symbols are in
brackets after company names.
The Hang Seng Indexs membership will remain unchanged
after a quarterly review by the compiler scheduled to be
announced after the market closes today, Goldman, Sachs %26amp; Co.
predicted in a research note yesterday.
PCCW Ltd. (8 HK) may be dropped from the measure, Nomura
Holdings Inc. had said in a Jan. 25 report. PCCW, Hong Kongs
largest phone company, dropped 4 cents, or 0.9 percent, to
HK$4.41.
Great Eagle Holdings Ltd. (41 HK) soared HK$3.80, or 16
percent, to HK$28, its biggest jump since Feb. 9, 2004.
Champion Real Estate Investment Trust (2778 HK), Hong Kongs
first prime office property trust, lost 23 cents, or 5.3
percent, to HK$4.08, its steepest decline since Nov. 5.
Champion REIT said yesterday it will buy Langham Place, a
1.94-million square-foot development, from controlling
shareholder Great Eagle for HK$12.5 billion ($1.6 billion) to
benefit from rising property prices.
To contact the reporter on this story:
Hanny Wan in Hong Kong at
