HONG KONG (Nikkei Markets) -- Hong Kong stocks fell on Thursday, with losses for mainland equities and caution over an upcoming meeting between the American and Chinese presidents helping drag down the market despite broad gains elsewhere in the region.
The Hang Seng Index ended the day 0.9% lower at 26,451.03 after rising as high as 26,923.33. London-headquartered lender HSBC Holdings shed 1.5% and Industrial & Commercial Bank of China lost 1.3%, while internet-services major Tencent Holdings gave up 0.9%. China Construction Bank erased early gains to drop 0.8%.
Local stocks disregarded a strong bounce on Wall Street overnight after U.S. Federal Reserve Chairman Jerome Powell said policy rates were "just below" neutral, fueling speculation the central bank may not raise interest rates by as much in the coming quarters as some had anticipated. The dollar index fell 0.6% overnight, while the three major U.S. equity gauges rose 2.3% or more. The Fed is still widely expected to deliver this year's fourth rate hike next month.
The Nikkei Asia300 Index of regional companies outside Japan was up 0.3%.
Hong Kong stocks "rallied in advance yesterday, ahead of Powell's speech," said Kevin Leung, director of global investment strategy at Haitong International Securities in Hong Kong, adding that expectations of a slower path for rate hikes were already priced in. Leung expects some profit-taking in the near term, but said December will likely "have more upside."
In the mainland, the Shanghai Composite Index reversed initial gains to end 1.3% lower. The yuan traded onshore was up 0.1% against the dollar at 6.9462. Investors continue to await the meeting between the U.S. and Chinese presidents at the G-20 summit this weekend.
"There won't be a big breakthrough" at the meeting between U.S. President Donald Trump and China's Xi Jinping, but more bad news was unlikely, Leung said.
Jewelry retailer Luk Fook Holdings International slid 6.6% to HK$23.45 despite a 28.5% increase in its net profit for the six months ended Sept. 30 and a 25% jump in revenue. Nomura downgraded the stock to "neutral" from "buy" and cut its price target to HK$26.40 from HK$36.20, citing weaker-than-expected gross profit margins and a "significant" drop in same-store sales growth since October. Chow Tai Fook Jewellery Group fell 6.9% ahead of its half-yearly results.
Fashion retailer Global Brands Group slumped 17.2% after saying it swung to a loss of $284 million in the April-September period from a profit last year. Its revenue fell 4.1% to $699 million.
Technology products maker China Goldjoy Group added 2.7% after saying a unit agreed to buy an additional 28.2% stake in Hong Kong-listed information technology company New Sports Group for HK$411.9 million ($52.7 million), or HK$0.36 per share, taking its total stake to 29.2%. New Sports Group's shares soared 71.9%.
CSI Properties rose 1.6%. It reported a 64.5% increase in half-yearly net profit as revenue for the period more than doubled.
AV Concept Holdings climbed 9.1%. The semiconductor distributor on Wednesday posted a 7.2% decrease in net profit for the six months to Sept. 30, but said revenue rose 15.6% from a year ago.
Advertising services provider Most Kwai Chung added 2.1% after reporting a more than doubling of its net profit for the April to September period.
-- Amy Lam