Search

 

Cablegate: Hang Seng Plummets 12.7 Percent, Largest Drop Since 1989

VZCZCXRO5436
RR RUEHCHI RUEHCN RUEHDT RUEHGH RUEHHM RUEHNH RUEHVC
DE RUEHHK #1983 3011005
ZNR UUUUU ZZH
R 271005Z OCT 08
FM AMCONSUL HONG KONG
TO RUEHC/SECSTATE WASHDC 6113
INFO RUCNASE/ASEAN MEMBER COLLECTIVE
RUEHOO/CHINA POSTS COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEATRS/DEPT OF TREASURY WASHDC

UNCLAS HONG KONG 001983

SIPDIS

STATE FOR EAP/CM AND EEB/OMA, TREASURY FOR OASIA

E.O. 12958: N/A
TAGS: ECON EFIN EINV ETRD HK CH
SUBJECT: Hang Seng Plummets 12.7 percent, Largest Drop Since 1989

1. The Hang Seng Index plummeted as much as 15 percent to a low of
10,685 before recovering slightly to finish the day down 1602.54
points, or 12.7 percent, at 11,015.84. This marked the largest
single-day drop since the Tiananmen Incident in 1989. No one was
spared, but Chinese corporate stocks in every sector took the worst
beating. ICBC fell 11 percent, Aluminum Corp of China (Chalco)
dropped 20 percent and Citic Pacific plunged 24 percent as investors
sought help from Hong Kong Legislative Council members to claim
compensation for that company's US$2 billion loss on currency
derivatives. HSBC shares were also down sharply. Analysts said
that wide-spread pessimism about an economic recovery, combined with
the slide in Japan's Nikkei, dropping NYSE futures markets, and
worse than predicted profit announcements by ICBC and Chalco, drove
the market down.

2. Interbank liquidity tightened for overnight and borrowing
exceeding one month. HIBOR on Monday, October 27, rose to 1 percent
for overnight, 2 percent for one week, 2.75 percent for two weeks,
3.8 percent for one month, 4.05 percent for two months, 4.15 percent
for three and six month borrowing and 4.1 percent for 12 month
loans. That compares to 0.8 percent for overnight loans and 3.6
percent for one, two, three and six month borrowing on Friday.

3. A better than expected Hong Kong trade report could not reverse
the slide in equities. September exports increased 3.6 percent, up
from a 1.9 percent increase in August. But third quarter exports
fell by 5.7 percent compared to last year. Exports of machinery and
electronics to China and the region were down, suggesting further
slowing of trade in the months ahead. Imports for the month were up
3.9 percent, up from August's 1.5 percent growth.

© Scoop Media

 
 
 
World Headlines

 



UN: Bachelet Calls On Mexico To Step Up Efforts As Tragic Milestone Reached Of More Than 100,000 Disappearances

UN High Commissioner for Human Rights Michelle Bachelet on Tuesday called on the Mexican authorities to step up efforts to ensure truth and justice for victims of disappearances, who now number more than 100,000, according to official data... More>>


ADC: Statement On The Assassination Of Shireen Abu Akleh

Early this morning in Jenin, Occupied Palestine, revered Palestinian voice Shireen Abu Akleh, a Palestinian American journalist for Al Jazeera, was assassinated by Israeli Occupation Forces snipers...
More>>



Ukraine: UN Rights Office Probe Spotlights Harrowing Plight Of Civilians

Almost 76 days since Russia invaded Ukraine, countless civilians remain caught up in the horror and destruction of war, UN rights investigators said on Tuesday... More>>



Access Now: Elon Musk’s Twitter Buyout Must Not Come At The Expense Of Human Rights

Following today’s announcement that Elon Musk will acquire complete ownership of Twitter in a cash sale of around 44 billion USD, pending shareholder approval, Access Now urges Twitter’s Board, employees, and shareholders... More>>



UN: Biodiversity And Ecosystem Protection Highlighted On Mother Earth Day

Marking International Mother Earth Day, UN General Assembly President Abdulla Shahid urged on Friday, for collective action to safeguard biodiversity and protect ecosystems... More>>

Ukraine: Hundreds More Reach Safety After Fleeing Besieged Mariupol
In Ukraine, humanitarians said on Wednesday that hundreds of people have managed to reach safety after fleeing Mariupol, where there’s also been condemnation for the killing of Lithuanian filmmaker Mantas Kvedaravicius... More>>