HK shares seen lower on oil price surge
HONG KONG, June 30 (Reuters) - Hong Kong shares are set to finish their worst first half in at least a decade on Monday, firmly in the grip of the bears with crude oil prices scaling a record high close to $143 per barrel last week.
The benchmark Hang Seng Index .HSI has given up nearly 21 percent since the end of last year.
U.S. crude futures shot to a record high of $142.99 during intraday trade on Friday, as waning confidence in the equity markets drove fresh investors into commodities and sent stocks tumbling. [nSYD129383]
"The market is headed down again but it's getting really hard to tell where the bottom is. Higher crude oil prices have put investors on alert for higher inflation and global markets are taking a beating," said Linus Yip, strategist with First Shanghai Securities.
Hong Kong shares fell 1.8 percent to a three-month low on Friday, as the prospect of lower earnings at major U.S. corporations and speculation of an imminent rate hike in China spooked investors.
Investors will be watching the ten-minute closing auction at the end of the trading day today after an unusually high -- 17 percent of the total turnover that day -- volume of shares changed hands during the closing auction on May 30. The sudden jump was attributed to a realignment, involving over 160 stocks, by the MSCI Barra Index.
But traders say that the exchange regulator has warned the investing community about likely unusual activity during month-ends, quarter-ends and half-year ends.
"We have been taking soundings from the market and in a couple of months we will review the new closing auction system. We will also consider the view the to allow short-selling during the closing auction," Hong Kong Exchanges & Clearing chairman Ronald Arculli told Reuters last week.
STOCKS TO WATCH- *China Shipping Development (1138.HK) told the Hong Kong stock exchange late on Friday that it agreed to sell container vessels to sister firm China Shipping Container Lines Co Ltd (2866.HK) for a total of US$36.52 million. here
*Shandong Molong Petroleum Machinery Co Ltd (0568.HK) said the issue review committee of the China Securities Regulatory Commission did not approve its application for the issue of A shares. here
*Jiangxi Copper (0358.HK) said it will invest US$329.3 million in a joint venture with state-owned China Metallurgical Group Corp to develop the Aynak copper mine in Afghanistan, the Standard newspaper reported.
----------------------MARKET SNAPSHOT @ 2247 GMT ------------
INSTRUMENT LAST PCT CHG NET CHG S&P 500 .SPX 1278.38 -0.37% -4.770 USD/JPY JPY= 106.3 0.13% 0.140 10-YR US TSY YLD US10YT=RR 3.969 -- 0.000 SPOT GOLD XAU= 928.15 0.11% 1.000 US CRUDE CLc1 140.93 0.51% 0.710 DOW JONES .DJI 11346.51 -0.93% -106.91 ASIA ADRS .BKAS 149.02 0.11% 0.17 -------------------------------------------------------------
MARKETS SUMMARY *U.S. stocks end lower, Dow on cusp of bear market [ID:nN27486445] *Oil hits record near $143 on rising investor flows [ID:nSYD129383] *Yen, Swiss franc gain as risk appetite fades [ID:nN27578859] *Treasuries shine as safe haven from ugly stocks [ID:nN27475686] *Gold hits 1-month high on record oil, weak stocks [GOL/] *SE Asian Stocks-Mostly lower on inflation woes, Vietnam up[.SO]
(Reporting by Parvathy Ullatil; Editing by Jonathan Hopfner)
