Hong Kong share prices closed down 4.3 percent on Monday, as banking giant HSBC bumped up its mortgage rate, sending property stocks tumbling, dealers said. The benchmark Hang Seng Index closed down 801.41 points at 17,880.68. Turnover remained light at 54.97 billion Hong Kong dollars 7.05).
HSBC increased its rate on new mortgages by 50 basis points from Monday as interbank lending rates here have surged in recent days amid ongoing liquidity concerns. Dealers said they expect the local market's volatility to continue in the near term as the global financial crisis is showing no clear signs of improvement.
"There is no indication when the current selloff could end as we don't expect to see any positive leads in the future to attract investors' attention," Castor Pang, a strategist at SHK Financial told Dow Jones Newswires.
HSBC's interest rate on new mortgage loans of more than 1.5 million dollars has risen to 3.25 percent. New World Development tumbled 13 percent to 8.23 dollars, Sino Land shed 7.8 percent to 8.90, and Cheung Kong Holdings lost 7.0 percent to 87.00.
Rechargeable battery maker BYD Company soared after tycoon Warren Buffett's Berkshire Hathaway investment company said it would take a 9.89 percent stake in it for 230 million US dollars through one of its subsidiaries. Mainland insurance group Ping An fell 10.5 percent to 42.50 dollars on worries about its exposure to Belgian-Dutch bank Fortis, which could be partially privatised in a move by several European governments. Other Asian bourses ended the day lower after opening brightly, on continued worries about the giant US bailout package for the financial sector.
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