Hong Kong shares slip after yuan devaluation, airlines down
Reuters
Published Aug 11, 2015 09:14
Hong Kong shares slip after yuan devaluation, airlines down
(Reuters) - Hong Kong stocks surrendered earlier gains and ended lower on Tuesday, weighed down by Chinese airlines and importers, sectors seen likely to be hurt by a weaker Chinese yuan currency.
The Hang Seng index (HSI) fell 0.1 percent, to 24,498.21, while the China Enterprises Index (HSCE) lost 0.2 percent, to 11,264.64 points.
China devalued its currency on Tuesday after a run of poor economic data, a move it billed as a free-market reform but that some suspect could be the beginning of a longer slide in the exchange rate.
Chinese airlines dived in response, as a weaker yuan threatens to increase borrowing costs for operators, which typically have huge borrowings denominated in hard currencies.
China Southern Airlines Co (HK:1055) fell 18.1 percent, China Eastern Airlines Corp (HK:0670) dropped 16.4 percent and Air China (HK:0753) fell 12.8 percent.
Financial (HSCIF) and property (HSCIPC) shares also fell, but an index tracking energy firms (HSCIE) rose 1.6 percent.
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Written By: Reuters
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