Mainland China and Hong Kong shares slide in global sell-off

  • Mainland China and Hong Kong shares slide in global sell-off

Mainland China and Hong Kong shares slide in global sell-off

Tokyo led a fall down throughout the region in early trade plunging more than five per cent, while Hong Kong was behind nearly four per cent at one point and Sydney sank three per cent.

Hong Kong's benchmark Hang Seng Index opened 2.7% lower, while the Hang Seng China Enterprise Index, which tracks Chinese companies listed in the city, was down 3% at open.

MARKET INSIGHT: "The trigger point was the USA and the interest rate fears", said Jackson Wong, an associate director at Huarong International Securities.

The lead from Wall Street is brutal as stocks moved sharply lower on Friday as traders anxious about the prospect of higher interest rates - extending the pullback last week's record highs.

The 10 Red-chips and P-chips constituents will be added to the HSCEI in five phases over a period of 12 months, with the first phase starting on March 5 and the last phase on March 2019, Hang Seng Indexes said in a statement.

And Wall Street looks set for another rough ride on Tuesday. Dow futures were swinging wildly.

This fell off in the stocks world wide began in the last week when the news of a solid United States jobs report boosted expectations of a rise in the USA federal interest rates.

Selling on global stock markets has ramped up because of expectations the U.S. Federal Reserve could increase interest rates more quickly than previously thought.

The global forecast for the Asian markets is broadly negative over concerns for the outlook on interest rates. That's led to fears that inflation - which has been unusually low in recent years - could be about to make a big comeback.

Albert Xu, Hong Kong-based strategist at Zhongtai International Securities Limited, said investors had been too complacent and that a correction in global equities was long over-due.

The worries arrived at a time when the Dow and many other major stock indexes were trading near record highs.

The Nikkei has been one of Asia's strongest performing indexes lately, but its plunge this week has now erased all of its gains for the year so far.