Hong Kong stocks slump on first trading day of October

HONG KONG: Hong Kong shares fell sharply on Tuesday, the first trading day of October, giving back all their gains from the previous session, as U.S. Treasury yields hit a 16-year high. Hang Seng Index, Hang Seng Tech Index and Hang Seng China Enterprises Index all declined more than 3%. Hong Kong markets were closed for a public holiday on Monday and Mainland China markets are closed this week for the Golden Week holiday. The China-Hong Kong stock connect program is also closed for the week. China’s factory activity expanded at a slower pace in September, a private-sector survey showed on Sunday, with sluggish external demand weighing on the outlook even as output increased. The Caixin/S&P Global manufacturing purchasing managers’ index (PMI) fell to 50.6 in September from 51.0 in the previous month, missing expectations. Alibaba plans to list logistics arm in Hong Kong IPO The stock decline on Tuesday points to no specific reasons as trading volume is muted during the Golden Week, analysts said, but the hawkish U.S. Federal Reserve stance on keeping rates higher for longer continues to weigh on the market. The market rose for no reason on Friday, and it’s unwinding now, Steven Leung, director of institutional sales at UOB Kay Hian in Hong Kong said. “Speculators are buying Evergrande, but there’s still a lot of uncertainty in the Chinese property sector,” he said, adding that markets generally are very nervous on U.S. rates. “If we don’t get some good news, it’s going to be a bad week.” Shares of China Evergrande resumed trading on Tuesday and jumped 40% in the morning trade, days after the embattled developer said its billionaire founder was being investigated over unspecified crimes. The shares were suspended last Thursday after a report that its chairman and founder had been placed under surveillance.