HONG KONG (Nikkei Markets) -- Hong Kong shares declined on Monday after a two-week winning streak, weighed down by concerns about the city's economic climate following anti-government demonstrations that spilled over into a 15th straight weekend.
The Hang Seng Index dropped 0.8% to 27,124.55. The gauge rose 2.5% last week, completing a second consecutive weekly advance. Heavyweights China Construction Bank and Tencent Holdings shed 1.9% and 0.9%, respectively.
Yixin Group, the operator of an online automobile financing platform, surged 24% after Tencent and Hammer Capital offered to buy shares in U.S.-listed Chinese advertising company Bitauto Holdings that they don't already own. Bitauto has a controlling stake in Yixin.
Hong Kong Exchanges & Clearing declined 2.4% after the London Stock Exchange Group on Friday rejected its 29.6 billion pound ($37 billion) acquisition bid. HKEX said it plans to continue engaging with LSEG shareholders.
Sentiment was weak after violent protests on Sunday marked a 15th consecutive weekend of political unrest in Hong Kong. More than 10 days after the city's Chief Executive Carrie Lam announced the withdrawal of a controversial extradition bill that have sparked protests since June, activists continue to stage demonstrations as four of their five demands remain unmet.
"Local political issues showed signs of escalation over the past weekend," said Louie Shum, chief executive at Sincere Securities. Meanwhile, "the market has already priced in Sino-American trade talks. Unless there is something certain and concrete," people are not expecting much, he added.
Chinese pork producer WH Group rose 0.5% after Beijing said on Friday that it would cancel additional tariffs on imports of pork and soybeans from the U.S. WH Group, which has significant business interests in the U.S., has been caught in the crosshairs of the Sino-American trade war that started early last year. Shares of WH Group shed 31.6% in 2018.
China's reconciliatory move on Friday was the latest in a series of indications that tensions between the U.S. and China are easing ahead of trade talks in October. Last week, U.S. President Donald Trump said he was postponing the imposition of a 5% additional tariff on Chinese goods by two weeks, while China released a list of U.S. goods that would be exempt from a 25% extra import tariff that was imposed last year.
On the mainland, the Shanghai Composite Index ended little changed, while the yuan traded onshore strengthened 0.1% against the U.S. dollar to 7.0658.
Data released earlier on Monday showed China's industrial output rose 4.4% in August, slowing from July's 4.8% pace and falling short of the 5.2% growth analysts polled by Reuters were expecting. Retail sales in Asia's largest economy grew 7.5% last month. Analysts polled by Reuters were expecting a reading of 7.9%.
Meanwhile, the Hong Kong-listed shares of energy producers CNOOC and PetroChina jumped 7.4% and 4.3%, respectively, amid a surge in global oil prices after an attack on Saudi Arabia's oil infrastructure thwarted the country's oil production. Brent crude futures were last up 8.4% at $65.28 a barrel after jumping as much as 19.5% in early Asian trading.
China Mengniu Dairy slipped 2.3% after announcing an agreement to buy infant formula maker Bellamy's Australia for 1.46 billion Australian dollars ($1 billion).
-- Benny Kung