Hong Kong stocks tumble on coronavirus fears

Hong Kong’s stock market tumbled as Chinese companies listed in the Asian financial hub were hit by the rapid spread of the deadly coronavirus that has forced authorities to restrict travel from the mainland.

The benchmark Hang Seng index fell 3 per cent on Wednesday after traders returned from the long lunar new year holiday.

Chinese officials on Wednesday said the death toll from the coronavirus, which originated in the now quarantined city of Wuhan, had risen to 132, while the number of confirmed cases in China climbed to 5,974. 

The Hang Seng China Enterprises index, which tracks the performance of large Chinese companies listed in the territory, fell 3.2 per cent.

Hong Kong’s flag carrier Cathay Pacific, which said on Tuesday it would sharply reduce flights to mainland China as a result of the epidemic, fell 3 per cent. Chinese technology groups Alibaba and Tencent dropped 3.9 and 0.9 per cent, respectively.

HSBC, Europe’s biggest bank by assets, sank 2.8 per cent. The lender makes about 80 per cent of its profits from Hong Kong and mainland China.

Wharf Real Estate, which operates large shopping centres in the territory and relies on Chinese tourists for revenue, plunged 5.9 per cent.

The sharp sell-off came after Carrie Lam, Hong Kong’s chief executive, said on Tuesday that the city would suspend rail services to China from later this week. Hong Kong will halve the number of flights between the territory and mainland China, as well as suspending visitor permits for Chinese tourists.

Markets in Shanghai and Shenzhen remain closed on Wednesday for the long Lunar New Year holiday. Both had been slated to reopen on Friday, but the Chinese central bank on Tueday said it would extend the holiday through the end of this week. Shanghai’s local government has ordered businesses in the mainland Chinese financial hub to stay closed until February 9.

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AAC Technologies, a chipmaker and Apple supplier, fell 4.4 per cent after the US technology group projected an “unusually wide” range for revenue in the first quarter to account for the “potential impact” across its supply chain from the virus.


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