Hong Kong shares flat by noon as HSBC drops, developers gain
HONG KONG (Nikkei Markets) -- Hong Kong shares were little changed amid caution ahead of a long weekend, with HSBC Holdings declining after overnight losses on Wall Street, while mainland companies found support from U.S. President Donald Trump's comment that he wouldn't label China a currency manipulator.
The Hang Seng Index slipped less than 0.1% to 24,296.85 by midday after falling as much as 0.6% earlier. HSBC was the biggest drag by points. It shed 0.8% after U.S. 10-year Treasury yield declined to a five-month low. The Hang Seng China Enterprises Index rose less than 0.1%, while the CSI 300 Index of large Chinese companies listed in Shanghai and Shenzhen added 0.2%.
The S&P 500 Index suffered its worst decline in three weeks Wednesday, and U.S. bond yields and the dollar retreated in Asian trading, weighed down by Trump's comments in a Wall Street Journal interview that the dollar was "getting too strong" and that he preferred low interest rates. In another flip-flop from his campaign rhetoric, the U.S. president also said his administration will not label China a currency manipulator, prompting a rally in the yuan. The yuan traded offshore rose 0.1% Thursday, adding to a 0.2% advance overnight.
Cheung Kong Property Holdings added 1.3%, helping a gauge of property stocks higher. The developer sold almost all units at its Harbour Glory complex in Hong Kong within hours, South China Morning Post reported, signaling demand remains robust despite a government move to slap a higher stamp duty on first-time buyers acquiring more than one property at a time.
"While the change in Trump's position regarding the yuan is good, the problem for Hong Kong and global stocks is that there is a lack of any direction. So, the recent range-bound moves could continue," said Louis Tse, asset management director at VC Brokerage. "Also, investors are not too willing to make bets with the long weekend ahead."
Hong Kong markets will remain closed on Friday and Monday.
Cathay Pacific Airways jumped 1.8% after saying Chief Operating Officer Rupert Hogg will replace Ivan Chu Kwok-Leung as chief executive officer. The airline reported an annual loss for 2016, the first in eight years.
Chow Tai Fook Jewellery jumped 5.8% after reporting a 4% increase in March quarter same-store sales in Hong Kong and Macau, and a 12% gain in the mainland market.
Ping An Insurance Group dropped 0.4% amid the cautious sentiment, despite reporting higher gross premium incomes.
Prada slipped 1.7% after reporting a 16% decline in net income for the year ended Jan. 31. The luxury fashion group's net sales fell 10.4% in the same period.
China Resources Land added 0.2% following a 38% increase in March contracted sales.
China Petroleum & Chemical (Sinopec) fell 0.2%. China raised the retail price of gasoline by 200 yuan ($29) per ton and diesel fuel by 190 yuan, effective Thursday, Reuters reported, citing a statement from the National Development and Reform Commission.
Fosun International edged 0.2% lower. The conglomerate is planning to buy a stake in Russian gold producer Polyus, Reuters said citing Interfax news agency.
China Finance Investment Holdings, which plunged more than 57% on Tuesday without an apparent trigger, rose 9.6%. The company clarified that its chairman and major shareholder Lin Yuhao has not directly or indirectly pledged any of his shares.
--V. Phani Kumar and Nimesh Vora
--Nikkei Markets is a real-time financial news service for South East Asia's markets published by Nikkei NewsRise Asia Pte Ltd, a Nikkei and NewsRise joint venture company. Nikkei Markets provides wide companies coverage in the region, including the Nikkei's Asia300 companies.