China, Hong Kong stocks fall after Fed's surprise turn

China Feihe

21/06/2021 05:38

* SSEC -0.2%, CSI300 -0.6%, HSI -1.4%
    * HK->Shanghai Connect daily quota used -1.7%, Shanghai->HK
daily
quota used 0.5%
    * FTSE China A50 -1.1%

    SHANGHAI, June 21 (Reuters) - China and Hong Kong stocks
fell on Monday, tracking other Asian markets, as investors
continued to ponder the implications of the U.S. Federal
Reserve's surprise hawkish shift last week.
    ** The CSI300 index  .CSI300  fell 0.6% to 5,073.36 points
at the end of the morning session, while the Shanghai Composite
Index  .SSEC  dipped 0.2% to 3,517.17 points.  
    ** The Hang Seng index  .HIS  dropped 1.4% to 28,413.42
points, while the Hong Kong China Enterprises Index  .HSCE  fell
1.1% to 10,533.91.  
    ** Around the region, MSCI's Asia ex-Japan stock index
 .MIAPJ0000PUS  was weaker by 1.36%, while Japan's Nikkei index
 .N225  was down 3.59%. 
    ** U.S. St. Louis Federal Reserve President James Bullard
said on Friday that the U.S. central bank's shift towards a
faster tightening of monetary policy was a "natural" response to
economic growth and particularly inflation moving quicker than
expected as the country reopens from the COVID-19 pandemic.
 urn:newsml:reuters.com:*:nL2N2O0136  
    ** Analysts said a hawkish Fed could lead to a stronger
dollar and a weaker yuan, pressuring on the A-share market by
prompting foreign outflows. 
    ** The A-share market will be under heavy pressure against a
backdrop of a strong dollar, said Yan Kaiwen, an analyst with
China Fortune Securities. 
    ** Investors on Monday sold a net 764 million yuan ($118.14
million) worth of A-shares via the Stock Connect linking
mainland and Hong Kong, according to Refinitiv data. 
    ** Meanwhile, the dollar held near multi-month peaks against
other major currencies on Monday.  urn:newsml:reuters.com:*:nL2N2O3008 
    ** China kept its benchmark lending rate for corporate and
household loans unchanged for the 14th straight month at its
June fixing on Monday, in line with market expectations.
 urn:newsml:reuters.com:*:nAZN01B1RK  
    ** The Financial News, backed by the Peoples Bank of China
(PBOC), on Sunday advised against speculating about liquidity
tightening and policy direction, saying such action can mislead
and roil markets.  urn:newsml:reuters.com:*:nL2N2O2016  

($1 = 6.4669 Chinese yuan renminbi)

 (Reporting by Luoyan Liu and Andrew Galbraith; Editing by Amy
Caren Daniel)
 ((luoyan.liu@thomsonreuters.com; Reuters Messaging:
luoyan.liu.thomsonreuters.com@reuters.net))