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Hong Kong Market falls as HKEX bid for LSEG may face hurdles

The Hong Kong share market closed down on Thursday, 12 September 2019, weighed down by the Hang Seng Index heavyweight Hong Kong Exchanges and Clearing Limited (388 HK), as its surprise bid for the London Stock Exchange not cheered investors. At closing bell, the Hang Seng Index fell 0.26%, or 71.43 points, to 27,087.63. The Hang Seng China Enterprises Index added 0.26%, or 27.36 points, to 10,592.37.

The blue-chip index opened up 124 points to 27,283, which marked the day high. The index then gave up its gains and hit a day low of 26,967 (down 192 points) in the afternoon trade.

Investors weren't happy with the Hong Kong Exchanges and Clearing Limited (HKEX) proposed unsolicited US$36.6 billion takeover bid for the London Stock Exchange. Citigroup on Wednesday cut the exchange operator's rating to sell from buy with a new target of HK$210 a share, saying the high offer could weigh on HKEX's shares in the near term.

Blue chips were mixed. The Hong Kong Exchanges and Clearing Limited (HKEX) dropped shed 3.5% to HK$237.4, a day after it made a 32bn takeover bid for the London Stock Exchange, in a transaction that is expected to be rejected in the face of pushback from investors and regulators. HSBC (00005) dipped 0.8% to HK$60.25 after the global bank said it intends to sell its retail banking business in France. Tencent (00700) added 1% to HK$349.4 on the repurchase of 110,000 shares of its own. China Mobile (00941) nudged up 0.1% to HK$67.35. AIA (01299) slipped 1.4% to HK$79.2.

Shares of exporters climbed after the US President Donald Trump delayed for two weeks a planned tariff hike on US$250bn of Chinese goods, originally scheduled for 1 October. Techtronic Industries (00669) soared 4% to HK$57.3. WH Group (00288) jumped 3.9% to HK$7.22. Minth Group (00425) surged 3.5% to HK$26.7. Nexteer Automotive (01316) added 1% to HK$6.91.

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