By the midday break, the Hang Seng Index was down 1.9 per cent at 27,954.52, the lowest since Jan. 12, while Chinese H-shares listed in Hong Kong fell 2.18 per cent to 10,868.77.
Mainland shares also extended losses, with the Shanghai Composite index down 1.22 per cent at 3,369.78 points while the blue-chip CSI300 index dropped 1.39 per cent.
With more people getting vaccinated against the coronavirus and as the economy continues to improve, Dallas Federal Reserve President Robert Kaplan said on Tuesday that he is among the policymakers expecting the central bank to start raising rates as soon as next year.
On Wall Street overnight, the Dow Jones Industrial Average fell 0.94 per cent, the S&P 500 lost 0.76 per cent and the Nasdaq Composite dropped 1.12 per cent.
“Investors in Hong Kong are following the overnight risk-averse sentiment in Wall Street as Treasury yield continued hiking,” said Zhang Yanbin, an analyst with Zheshang Securities. “The expectation of Fed to start raising rates in the near future also weighed.”
Pony Ma, the reticent founder of Tencent Holdings, met with the country’s anti-trust watchdog officials this month to discuss compliance at his group, two people with direct knowledge said, an indication that China’s antitrust crackdown could soon target other internet behemoths.
The sub-index of the Hang Seng tracking the IT sector led the losses by falling 2.5 per cent while the biggest loser was Geely Automobile Holdings Ltd, which was down -13.26 per cent.
Leading the declines in mainland, the CSI300 transportation index and CSI300 resource index dropped 4.3 per cent and 4.1 per cent, respectively.
Around the region, MSCI’s Asia ex-Japan stock index was weaker by 1.04 per cent while Japan’s Nikkei index was down 1.57 per cent.
The yuan was quoted at 6.5227 per U.S. dollar, 0.1 per cent weaker than the previous close of 6.516.
