Hong Kong Market falls on trade concerns, Typhoon double blow

Headline indices of the Hong Kong share market closed down on Monday, 17 September 2018, as risk aversion selloff triggered on reports that Donald Trump was preparing to impose tariffs on a further US$200 billion of Chinese imports. Meanwhile, selloff pressure intensified on concerns about economical impact of a severe typhoon Mangkhut over the weekend. The Hang Seng Index tumbled 353.56 points or 1.3% to 26,932.85. The Hang Seng China Enterprises Index fell 113.08 points or 1.07% to 10,462.09. The sub-index of the Hang Seng tracking the Commerce & Industry sector dropped 1.9%, properties sector fell 1.1%, financial sector was 0.9% down, and Utilities sector fell 0.8%.

As per reports, Trump was going ahead with plans to impose new tariffs on about $200 billion of Chinese imports. The tariff level will likely be set at about 10%, below the 25% announced earlier this year. At the same time, U.S. officials, led by Treasury Secretary Steven Mnuchin, are preparing to hold new talks on the tariff dispute with Beijing. Envoys met last month in Washington but reported no progress. The two governments have already imposed 25% tariffs on $50 billion of each other's goods. Beijing has issued a list of another $60 billion of American products for retaliation if Trump's next tariff hike goes ahead.

Shares of Macau gaming counters were lower, as Typhoon Mangkhut, which moved from Hong Kong into Guangdong province Sunday evening, forced the suspension of Macau casino operations over the weekend, prompting brokerages houses to slash their September revenue growth forecasts. Galaxy Entertainment Group was the worst performer, sliding 3.4%.

Handset component makers fell across the board as the pre-orders of Apple's new iPhone XS in first week were not as sanguine as expected. AAC Technologies dipped 5.8%, Sunny Optical declined 4.7%, BYD Electronic sank 4%, and Q Technology slipped 1.2%.

Airlines were also hit by the typhoon, as hundreds of flights in and out of the city were canceled. Cathay Pacific Airways Ltd. dropped 2.5% in Hong Kong, Air China fell 1.2% and China Southern Airlines Co. lost 3.2%. China Eastern Airlines Corp. edged up 0.4%.

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