Hong Kong Exchange Drops on Worry Protests Will Hurt Trading
Hong Kong Exchange Drops on Concern Protests Will Drain Trading
(Bloomberg) -- Hong Kong Exchanges & Clearing Ltd.’s shares slipped on concern that continuing unrest in the city will cripple trading volume.
The exchange operator fell 2.1% on Wednesday, taking its retreat for the week to 4.7%. Speculation also circulated around trading floors that Alibaba Group Holding Ltd. may not be able to complete its share sale in the city, even as it was said to win approval to proceed with the listing.
“Hong Kong is in jeopardy and no one is very confident about the economy,” said Castor Pang, head of research at Core Pacific-Yamaichi International. “That’s hurting trading volume because sentiment is bad.”
Turnover on Hong Kong exchanges has fallen as many traders work from home. The value of shares traded tumbled about 27% on Tuesday compared to the average for this year.
Alibaba got the green light for a sale that could raise at least $10 billion, according to a person familiar with the matter. That approval comes as police and protesters clash across Hong Kong, including in recent days in the financial center. The city’s economy entered a recession in the third quarter, with gross domestic product retreating 3.2% from the previous three months.
HKEX reported last week that net income fell almost 10% in the three months through September from a year earlier. The drop was the biggest since the last three months of 2016.
To contact the reporter on this story: Jeanny Yu in Hong Kong at jyu107@bloomberg.net
To contact the editors responsible for this story: Sofia Horta e Costa at shortaecosta@bloomberg.net, Philip Glamann
©2019 Bloomberg L.P.