Bloomberg News

Hong Kong Stocks Drop on Europe Concern as Italian Yields Surge

November 15, 2011

Nov. 15 (Bloomberg) -- Hong Kong stocks fell, ending a two- day rally, after a surge in Italian borrowing costs raised concern Europe’s sovereign-debt crisis is spreading, damping sentiment for riskier assets.

Esprit Holdings Ltd., the Hong Kong-based clothier that counts Europe as its biggest market, slipped 1.7 percent. Evergrande Real Estate Group Ltd., China’s second-largest developer by sales, lost 1.5 percent after its Chairman Hui Ka Yan said the outlook for housing prices is “difficult.” China Construction Bank Corp. gained 1.5 percent after Bank of America Corp. said it will sell most of its shares in the No. lender.

The Hang Seng Index fell 0.6 percent to 19,390.42 as of 9:52 a.m. in Hong Kong, with three stocks falling for each that rose in the 46-member benchmark. The gauge slumped 3.6 percent last week, the biggest weekly decline since Sept. 23, after Italian bond yields rose to levels that caused other euro zone countries to seek bailouts.

The Hang Seng China Enterprises Index of Chinese companies listed in Hong Kong lost 0.4 percent to 10,672.52.

--Editor: Jason Clenfield.

To contact the reporter on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net.

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net


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