Hong Kong stocks hit eight-month low before U.S. tariffs kick in

Hong Kong shares dropped to an eight-month low on Thursday as investors braced for U.S. import tariffs on Chinese goods to take effect.

The Hang Seng Index slipped 0.2% to 28,182.09, capping its third straight loss and marking its lowest close since late October. Energy producers PetroChina and CNOOC shed 1.6% and 2.5%, respectively, as Brent crude futures declined 0.4%.

U.S. import tariffs on $34 billion worth of Chinese goods will take effect on Friday, and markets are worried about how Beijing would respond. On Thursday, China`s General Administration of Customs said on its website that additional tariff measures on U.S.-made imports will take effect immediately after the U.S. tariffs on its goods become effective. The Hang Seng Index is down 2.7% so far this week after shedding 5% in June.

The index is likely to see bigger moves tomorrow as the market has yet to fully price in the mutual tariff measures, said Louie Shum, CEO at Sincere Securities. Even though China has said it will wait for the U.S. to act first, that does not mean China will take a soft stance in retaliation.

In the mainland, the Shanghai Composite Index dropped 0.9%, while its Shenzhen counterpart fell 2.2%. The yuan traded onshore fell 0.1% to 6.6355 against the U.S. dollar.

Chinese property developers listed in Hong Kong were mixed after some reported their monthly sales data.

Country Garden Holdings climbed 2%, among the days biggest gainers on the Hang Seng Index, after reporting a 42.8% jump in contracted sales in the January to June period to 412.49 billion yuan ($62.19 billion)

China Overseas Land & Investment fell 1% despite reporting a 25% increase in contracted sales for June, and Agile Group Holdings slid 2.8% in spite of a 6.3% increase in the value of its pre-sales in June. China Vanke rose 2.2% after a 33.6% increase in contracted sales for June to 65.65 billion yuan.

Shimao Property Holdings climbed 4.7% after its June contracted sales surged 83.4% from a year earlier, while Beijing Capital Land advanced 4.4% following a near fourfold jump in last month`s contracted sales.

Companies under the HNA Group umbrella fell in Hong Kong after the company said Wang Jian, co-founder and chairman of the Chinese conglomerate, died on Tuesday following an accident in France.

CWT International, formerly known as HNA Holding Group, declined 5.1%. It said on Thursday that its units will sell warehouse properties in Singapore for a total of 730 million Singapore dollars ($535 million).

Smart-card-reader supplier HNA Technology Investments Holdings fell 2.7% after saying it expects to swing to a net loss for the six months ended June 30.

Jewelry-maker Hifood Group Holdings, an indirect subsidiary of HNA Group, declined 0.5%, while Hong Kong International Construction Investment Management Group, another HNA-linked company, fell 3.7%.

Elsewhere, China Communications Construction inched up 0.1% from a two-year low. The company on Wednesday confirmed that it had received a notice from Malaysian authorities to suspend all work on the Malaysia East Coast Rail Link. Earlier in the week, Malaysian Finance Minister Lim Guan Eng said the project was economically and financially viable only if the cost was sharply cut.

Fosun International slipped 0.1%. The diversified conglomerate said on Wednesday that the Hong Kong stock exchange had approved its proposal to spin off unit Fosun Tourism & Culture Group for a separate listing in the city.

Integrated-circuit chipmaker China Electronics Huada Technology lost 6.3% after forecasting a 50% to 60% drop in consolidated profit for the six months ended June 30.

This article provided by NewsEdge.