Headline indices of the Hong Kong share market closed down on Wednesday, 11 July 2018, amid an escalating trade spat between the United States and China after the release of a list of an additional $200 billion in Chinese goods on which the U. S. is considering imposing tariffs. The benchmark index opened down 668 points to 28,013, which marked the intra-day low. But it recovered part of its lost ground afterwards. At the close of trade, the Hang Seng Index dropped 370.56 points or 1.29% to 28,311.69. The Hang Seng China Enterprises Index fell 166.71 points or 1.54% to 10,658.26. Turnover increased to HK$98.5 billion from HK$93.4 billion on Thursday. Turnover decreased slightly to HK$95.9 billion from HK$98.7 billion on Tuesday.
The United States government decided to impose the extra tariffs after efforts to negotiate a solution to the dispute failed to reach an agreement.
U. S. officials released a list of thousands of Chinese imports the administration wants to hit with the new tariffs, including hundreds of food products as well as tobacco, chemicals, coal, steel and aluminum. It also includes consumer goods ranging from car tires, furniture, wood products, handbags and suitcases, to dog and cat food, baseball gloves, carpets, doors, bicycles, skis, golf bags, toilet paper and beauty products.
A spokesperson for the Chinese Ministry of Finance said on Wednesday that Beijing would respond with countermeasures and safeguard its rights, describing the U. S. move as bullying.
Last week, Washington imposed 25% tariffs on $34 billion of Chinese imports, drawing immediate retaliatory duties from Beijing on US imports in the first shots of a heated trade war. US President Donald Trump had warned then that his country may ultimately impose tariffs on more than $500 billion worth of Chinese imports.
Shares of Mainland lenders declined, after Credit Suisse lowered its forecasts for mainland lenders after raising credit cost estimates as these continue to build loan loss reserves that should reach 3% by end-2018. ICBC (1398), CCB (00939) and PSBC (01658) fell between 2-3% to HK$5.56, HK$6.85, and HK$4.93.
Shares of Chinese developers were down by reports of further tightening measures in second half of the year. Country Garden (02007) declined 3.3% to HK$12.82. China Vanke (02202) dropped 5% to HK$25.2. China Overseas Land & Investment (00688) flopped 2.7% to HK$25.9. China Resources Land (01109) dipped 1.7% to HK$24.85.
China Eastern Airlines shares closed softer after the state-controlled carrier disclosed plans to raise up to $2.22 billion from share issues in mainland China and Hong Kong.
Great Wall Motor shares ended down as it plans to form a 50-50 joint venture with Germany's BMW for the research and production of new energy and internal combustion vehicles. Brilliance China Automotive Holdings, an existing joint venture partner of BMW, dropped as much as 1.5%.
China Petroleum & Chemical, or Sinopec, fell 0.9% after the company announced on Tuesday that it would inject 4.9 billion yuan ($736 million) in capital for a 49% stake in a joint venture with controlling shareholder Sinopec Group. The JV, Sinopec Capital, will engage in project investments and financial services.
Property developer Greenland Hong Kong Holdings declined 1.4% after reporting a 5.8% decrease in contracted sales for the first six months of 2018. Yuzhou Properties declined 3.3% after reporting a 12.5% year-over-year decrease in June sales.
Powered by Capital Market - Live News
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)