Hong Kong stocks are set to fall on Friday after a recent run-up to near four-1/2-year highs, with investors expected to lock in profits after losses on Wall Street and amid persistently high oil prices. The blue chip Hang Seng Index, which ended 0.05 percent lower at 15,111.54 points on Thursday, is seen continuing a two-session losing streak by giving back 100 points amid an consolidation, traders said.
"There will be a deeper consolidation today with weak overseas markets and high oil prices shares have been falling but so far they have only been baby steps," said Francis Lun, general manager of Fulbright Securities.
Lun said a rate-setting meeting by the US Federal Reserve next week would also dampen investor sentiment.
The Fed is widely expected to raise interest rates by another 25 basis points.
But he expects market sentiment to be optimistic for the rest of this year, with investors upbeat over the retail sector ahead of the of Disneyland in Hong Kong in September, and continued funds flowing into the region, betting on a further yuan revaluation.
CNOOC Ltd will be in the spotlight after its share tumbled 3.6 percent to HK$5.35 on profit taking after recently hitting record high levels fuelled by its pullout on a $18.5 billion bid for US producer Unocal Corp.
CNOOC's US-listed Drs fell 2.8 percent overnight. Oil trader and transported Titan Petrochemicals Group Ltd will also be in focus after it on Thursday said its first-half earnings rose 65 percent.