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Hong Kong - Hong Kong stocks headed for a weekly drop ahead of the release of US jobs data and Italy’s weekend referendum.
Casino companies led declines on the index, while technology shares retreated following a plunge in the US.
The Hang Seng Index fell 1.2% as of 08:02, with casino operators Galaxy Entertainment and Sands China sinking more than 4.8%.
Macau may require inbound travelers to disclose cash holdings of over $15 000 at entry, Teledifusão de Macau reported. Tencent headed for its lowest close since August 12. Investors are waiting for American jobs data, the last report before the Federal Reserve meets this month, while Italy will vote on constitutional reform at the weekend.
“Investors are trying to be risk-off right now - the market momentum is not strong,” said Castor Pang, head of research at Core-Pacific Yamaichi in Hong Kong.
The report of Macau’s cash disclosure rules is raising concern that “it will hurt casinos’ VIP business so share prices are falling even though they announced better than expected revenues.”
Hong Kong’s benchmark index is headed for a quarterly decline, with the city’s developers tumbling after the government announced a higher stamp duty to curb prices, and amid expectations that the Fed will raise interest rates this month. With the city’s dollar pegged to the greenback, borrowing costs track those of the US.
Tencent dropped 2.1% after the tech-heavy Nasdaq 100 Index slid 1.6% to a two-week low. Facebook fell 2.8% in Thursday’s session.
“That’s putting selling pressure on Tencent,” said Pang. “Tech stocks continue to be avoided by investors because it doesn’t look easy to break through their peak. Funds continue to flow out from tech stocks, putting pressure on them.”
The Hang Seng Index dropped to 22 602.26, on course for a 0.5% decline this week, while the Hang Seng China Enterprises Index slid 1%. The Shanghai Composite Index retreated 0.9%.
Mainland investors will be able to trade some smaller companies listed in Hong Kong from Monday, while foreign investors will have direct access to Shenzhen-traded shares, when the link between the two cities starts. The Shenzhen Composite Index was down 1.3%.
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