Hong Kong, China stocks fall amid geopolitical worries; defence stocks jump

Kunlun Energy

11/04/2017 05:49

* SSEC -0.5 pct, CSI300 -0.7 pct, HSI -0.9 pct 
    * Defence stocks rally amid geopolitical concerns 
    * Chinese traders ordered to return North Korean coal - 
source 
 
    SHANGHAI, April 11 (Reuters) - Stocks in Hong Kong and China 
fell on Tuesday morning as investors' appetite for risky assets 
soured on concerns over political tensions in North Korea and 
the Middle East. 
    Energy stocks were among the biggest decliners in both 
markets, underpinned by losses in coal miners, after a trading 
source said China's customs department ordered traders to return 
North Korean coal.  urn:newsml:reuters.com:*:nL3N1HI2PB 
    Hong Kong's Hang Seng index  .HSI  was down 0.9 percent at 
the end of the morning session, at 24,054.39, while the Hong 
Kong China Enterprises Index  .HSCE  lost 1.1 percent, to 
10,136.96. 
    A tense geopolitical situation remains at the forefront of 
market attention, said Linus Yip, a Hong Kong-based strategist 
at First Shanghai Securities.  
    "But the general impact of Trump-Xi meeting is positive, as 
you can see the two countries maintain a relatively good 
relationship after the meeting," Yip said. 
    He said China was expected to make some moves on South Korea 
after the meeting and that would weigh on the market in the 
short term. "No permanent enemies, no permanent friends."  
    Coal prices had slumped more than 4 percent by the lunch 
break after China's customs department issued an official order 
telling trading companies to return their North Korean coal 
cargoes.  
    Energy stocks were the biggest losers in a board-based 
decline, with an index tracking the sector  .HSCIE  shedding 1.6 
percent.     
    Kunlun Energy Co Ltd  0135.HK  had contracted about 4.7 
percent by midday, on news that its net profit in 2016 slumped 
56 percent from the previous year.  urn:newsml:reuters.com:*:nNRA3n4tme 
    China Finance Investment Holdings Ltd  0875.HK  plummeted 
around 65 percent and the reason was not immediately clear. The 
company reported a net loss of HK$520.7 million ($67.00 
million)in 2016 on March 31.  urn:newsml:reuters.com:*:nHKS2ty0cD 
    In China, the blue-chip CSI300 index  .CSI300  fell 0.7 
percent, to 3,481.28, while the Shanghai Composite Index  .SSEC  
lost 0.5 percent, to 3,254.24.  
    Defence stocks  .CSI399959  had jumped 2.2 percent at 
midday, as investors bet on further friction between China and 
the United States. 
    Banks  .CSI300BI  extended Monday's losses and were down 0.7 
percent, after China banking regulator issued risk control 
guidelines and fined 17 financial organisations a total of 42.9 
million yuan ($6.21 million) for avoiding supervision and 
engaging in unapproved operations. urn:newsml:reuters.com:*:nL3N1HI38T  urn:newsml:reuters.com:*:nL3N1HJ0HH 
      
($1 = 7.7713 Hong Kong dollars) 
     
($1 = 6.9035 Chinese yuan) 
 
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China stock market graphics suite     http://reut.rs/1NfkoGl 
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 (Reporting by Jackie Cai and John Ruwitch; Editing by 
Subhranshu Sahu) 
 ((Jackie.Cai@thomsonreuters.com; +86 021 6104 1775;)) 
 
Keywords: CHINA STOCKS/MIDDAY