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Nikkei Markets

Hong Kong shares give up most gains amid protest worries

HKEX edges up after first-half earnings, while WH Group tumbles on profit decline

HONG KONG (Nikkei Markets) -- Hong Kong shares let most of their early gains slip on Wednesday amid lingering worries over political unrest in the city and Chinese economic growth.

The Hang Seng Index ended less than 0.1% higher at 25,302.28. The gauge's closing level is about 415 points away from its intraday high, reached in early trading in the wake of strong overnight cues from Wall Street.

Internet services heavyweight Tencent Holdings rose 1.8% ahead of its second-quarter earnings release later Wednesday. Sunny Optical Technology Group jumped 8.7% after reporting a 21.3% jump in net profit for the first half and a 30% increase in revenue.

Hong Kong Exchanges & Clearing, the city's exchange operator, ended 0.5% higher after reporting a 3% increase in first-half net profit. Pork producer WH Group shed 5.4% after reporting a 16.9% drop in profit for the January-to-June period on Tuesday.

Equity indexes on Wall Street advanced overnight following two days of losses. The U.S. Trade Representative office on Tuesday said new tariffs on certain consumer items from China, such has cellphones and laptops, will be delayed to Dec. 15. President Donald Trump had earlier this month announced plans to impose 10% import tariffs on Chinese goods worth $300 billion at the beginning of September.

"The news came as a surprise," said Andrew Wong, chairman and chief executive at Anli Securities. "However, the market has other worries," such as the fallout from protests in Hong Kong and weak Chinese economic data.

Wong said with the Hang Seng Index still about 1,000 points away from last year's low, people are worried that there is room for more downside.

"For the Hang Seng Index to climb, social issues will need to be resolved," he said, adding that disruption at the Hong Kong airport had touched some international investors' nerves.

Hong Kong's international airport has resumed operations after some services were disrupted over the previous two days amid ongoing protests at its main terminal building.

Airport Authority Hong Kong on Wednesday said it had obtained a court order to stop protesters from blocking outbound passengers. The order forbids anyone from "attending or participating in any demonstration or protest or public order even in the airport other than in the area designated by the Airport Authority," the statement said.

In the mainland, the Shanghai Composite Index added 0.4%, while the yuan rose 0.4% against the dollar to 7.0127. Data released on Wednesday showed China's industrial output grew 4.8% in July, slowing from June's 6.3% growth, and below the 5.8% reading analysts polled by Reuters were expecting.

Cathay Pacific Airways was up 2.8% amid broad market gains after shedding 8.2% in a four-day losing streak amid worries over flight cancellations and Beijing's restrictions on the airline's crew, some of whom had participated or supported protests in Hong Kong.

Sports apparel and equipment maker Li Ning jumped 7.4% after reporting a near-tripling of its profit for the first half of the year, helped by a 33% jump in revenue.

Chinese automaker Dongfeng Motor Group advanced 0.5% after reporting an 18.8% increase in July sales.

Auto parts maker Nexteer Automotive Group slid 13.5% after reporting a 34.3% plunge in first-half net profit and a 10.5% decrease in revenue.

-- Benny Kung

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