HK equities sink as 10-year Treasury yield hits two-decade high

HONG KONG: Hong Kong stocks posted their steepest one-day decline in more than six months on the first trading day of October, as a surge in the 10-year US Treasury yield to a more-than-two-decade high and rising oil prices weighed on risk sentiment.

At the close, Hong Kong benchmark Hang Seng lost 2.6 percent, its biggest single-day loss since March 2026.

The Hang Seng China Enterprises Index and the Hang Seng Tech both fell more than 2 percent.

Financial and biotech stocks were among the biggest laggards.

Heavyweight insurer AIA tumbled 6 percent, while banking giant HSBC shed more than 5 percent.

Global bonds came under heavy selling pressure on Thursday, pushing borrowing costs in the United States, France and Japan to multi-decade highs and heightening concerns about further volatility across financial markets.

Higher rates tighten market liquidity, especially in interest-rate-sensitive markets like Hong Kong.

Macau gaming stocks listed in Hong Kong declined broadly with Galaxy Entertainment declining 4 percent, as the city’s gaming revenue continued to fall in September.

Lack of southbound inflows from mainland also weighed on Hong Kong’s market, market participants said.

China’s onshore financial markets are closed from October 1 until October 7 for the National Day holidays. Trading will resume on October 8.