Hong Kong Stocks Down, Guotai Junan Shares Slump on Missing CEO

Hong Kong shares fell on Monday, taking cues from weak mainland markets and as investors braced for a likely rise in U.S. interest rates next month.

The Hang Seng index fell 0.4 percent, to 22,665.90, while the China Enterprises Index lost 0.7 percent, to 10,229.43 points.

Investors appear increasingly relaxed about the prospect of higher U.S. interest rates, but they are looking for fresh cues on direction amid uncertainty about the Chinese economy.

Performance was mixed among main sectors, with IT and industrial stocks rising, but energy and property shares falling.

The financial sector was pulled down by Chinese brokerage Guotai Junan International Holdings Ltd.

Shares of Guotai Junan dived 12.3 percent, after it said it was unable to reach its chief executive Yim Fung since Nov. 18.

In contrast, shares of Chinese property developer Evergrande Real Estate jumped more than 5 percent to a 5-month trading high, after the company said it would pay $ 617 million for a 50 percent stake in a joint-venture life insurer.

Source : Reuters

MARKET

Chinese Stocks Fall on Restart of IPOs as Guotai Junan Slumps

Chinese stocks fell as Guotai Junan International Holdings Ltd. plunged in Hong Kong after the brokerage said it can’t contact its chairman, while technology companies slumped in Shanghai as the securities regulator gave the green light to initial public offerings following a five-month freeze.

Hong Kong’s Hang Seng China Enterprises Index dropped 0.5 percent to 10,245.91 at 3:02 p.m. Guotai Junan, one of China’s biggest securities firms, slid 12 percent after it said it failed to reach Yim Fung since last week. The Shanghai Composite Index fell 0.6 percent at the close as software companies slumped amid speculation investors are selling the priciest stocks to raise funds for new share offerings.

The China Securities Regulatory Commission has restarted IPOs for five companies to list on the Shanghai stock exchange and five in Shenzhen, according to a statement on its official microblog on Friday. Nearly every time a new batch of companies took orders over the past year, money-market rates climbed and the Shanghai Composite slumped as investors hoarded cash for their bids. The last batch of 28 will probably tie up 3.4 trillion yuan ($ 533 billion), according to the median of six analyst estimates compiled by Bloomberg.

Source: Bloomberg

MARKET