Hong Kong shares close lower in cautious trade

2007-12-28 01:59:38 AFP

HONG KONG, Dec 28, 2007 (AFP) - Hong Kong share prices closed 1.70 percent lower Friday amid geopolitical worries after the assassination of Pakistan opposition leader Benazir Bhutto, dealers said.

They said weaker-than-expected durable goods orders in the US also fuelled worries that the world's biggest economy may be headed for recession.

A fresh rise in oil prices added to the gloomy mood, while the settlement of December futures contracts also kept trade cautious, they added.

The Hang Seng index closed down 472.33 points at 27,370.60, off a low of 27,296.86 and a high of 27,678.40. For the week, the index is down 256 points or 0.93 percent.

Turnover was 78.22 billion Hong Kong dollars (10.03 billion US).

The market will have a half-day session on Monday ahead of the New Year.

Patrick Yiu, associate director at CASH Asset Management, attributed Friday's falls mainly to concerns over a slowdown in the US economy and some futures-related activity.

"Bhutto's assassination might have shaken global markets, but I expect this impact to be short term as investors are more concerned with what's happening on Wall Street and the uncertain outlook for its banking institutions and the overall economy," he said.

Bhutto, a former two-time prime minister of Pakistan, was shot dead by a suicide bomber who then blew himself up, killing at least 20 people, as she was leaving a campaign rally in Rawalpindi on Thursday.

Meanwhile, the US Commerce Department announced that orders for durable goods rose just 0.1 percent in November against economists' expectations for a 2.2 percent increase.

Large-caps traded lower, with China Mobile losing 3.60 dollars at 135, HSBC down 0.60 at 131, Hutchison Whampoa down 1.10 at 86 and HKEx down 0.80 at 220.

Properties were hit by continued profit-taking. Cheung Kong lost 3.90 at 137.60, Sun Hung Kai was down 4.60 at 159 and New World shed 0.30 at 27.10.

Bank of East Asia rose 1.40 to 52.90 after news that Criteria CaixaCorp, a unit of Spanish bank La Caixa, is increasing its stake in a 3.95-billion-Hong Kong-dollar deal.

Oil stocks were lower despite a fresh increase in crude oil prices amid geopolitical worries.

PetroChina fell 0.40 at 13.64 and Sinopec lost 0.46 at 11.70.

China telecom stocks were lower following Thursday's gains on hopes of an accelerated rollout of 3G networks on the mainland.

China Netcom was down 0.95 at 23.10, China Telecom fell 0.09 to 6.19 and China Unicom lost 0.10 at 17.88.