HONG KONG: Hong Kong stocks fell 0.68 percent on Friday mainly due to concerns about Beijing's efforts to cool the mainland economy, continuing a mostly downward path seen in the last fortnight.
The benchmark Hang Seng Index dropped 162.60 points to 23,617.02 on turnover of HK$64.03 billion ($8.22 billion). It has lost nearly three percent in a correction over the last two weeks.
Leading Hong Kong stocks lower was energy giant CNOOC, after investors were disappointed with its prediction of 10-12 percent growth in production of oil or oil equivalent this year. CNOOC fell 7.0 percent to HK$17.32.
Jackson Wong, an investment manager at Tanrich Financial Group, told Dow Jones Newswires sentiment among Chinese investors remained negative amid worries about further hikes in interest rates to tame inflation.
"There is an overall negative sentiment in the market because of the worries toward inflation. At the same time, investors are starting to unwind as the Chinese New Year holiday nears," he said.
Also falling in Hong Kong were mainland property developers, as China introduced long-heralded property taxes in Shanghai and Chongqing.
China Resources Land fell 0.4 percent to HK$13.90 after dropping 3.9 percent Thursday. China Overseas Land fell 0.3 percent to HK$14.70 after shedding 4.9 percent Thursday.
However in Shanghai, the Composite Index rose 0.13 percent as gains in cement and auto stocks offset losses in financial companies and some property developers.
The Index, which covers both A and B shares, was up 3.60 points at 2,752.75 on turnover of 98.5 billion yuan ($15.0 billion).
Under the new Chinese property taxes, people buying higher-end second homes in Shanghai and Chongqing now have to pay a 0.4-1.2 percent annual tax, effective from Friday.
But property developers' performance was mixed as some believed that the impact of the tax policy on the market would be limited, traders said.
"Speaking overall, the tax is less harsh than expected. It will have more of an impact on high-end users," Cao Xute, an analyst from Sinolink Securities, told Dow Jones Newswires.
Cement and auto stocks gained on attractive valuations.
Anhui Conch Cement jumped 2.1 percent to 29.64 yuan. SAIC Motor rose 3.7 percent to 17.33 yuan.
Heavyweight financial stocks tumbled.
Industrial and Commercial Bank of China fell 0.71 percent to 4.21 yuan, while China Merchants Bank lost 0.9 percent to 12.59 yuan.
HCenter>Copyright AFP (Agence France-Presse), 2011
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