Asia
Hong Kong Stocks Slump Amid Weak China Data; MMG Launches Share Plus Debt Offering
Hong Kong stocks slumped Tuesday as weaker-than-expected Chinese macro data weighed on investment sentiment.The Hang Seng Index fell by around 348.72 points, or roughly 1.4%, to end at 24,493.95, while the Hang Seng China Enterprises Index decreased by 135.69 points, or 1.6%, to end at 8,240.05.China's retail sales of consumer goods fell 0.6% year over year to 4.109 trillion yuan in May, reversing the 0.2% increase recorded in April. Last month's drop was also steeper than the consensus forecast for a 0.3% decline.Also, the country's fixed asset investment fell 4.1% year over year in the first five months of the year. The reading compared with the declines of 1.6% recorded in the January-April period and 2.3% consensus forecast tracked by Investing.com.Meanwhile, SPI Asset Management warned that Hong Kong stock prices could be under pressure as about $274 billion worth of previously issued shares are freed from their lock up periods over the next 12 months, the South China Morning Post reported."Names with large share releases, especially those already sitting on big post-IPO gains, can face technical selling pressure unless fresh liquidity arrives to absorb the paper," SPI Asset managing partner Stephen Innes reportedly said.In local development, the Chamber of Hong Kong Listed Companies is stepping up efforts to address low trading activity in many Hong Kong-listed stocks, arguing that limited liquidity is making it more difficult for companies to conduct secondary fundraising, Bloomberg News reported.In corporate news, MMG (HKG:1208) is looking to raise HK$6.25 billion from a share sale, and a further $800 million via bonds.The company will use proceeds to refinance existing loans, support the development of existing projects and expansion plans, fund investments, and replenish working capital.
Hang SengHKG:1208
