Hong Kong stocks see steepest drop in nearly a year on rate and Iran worries
Hang Seng Index slumps as investors brace for tighter monetary policy, with oil shock and war risks darkening sentiment
The Hang Seng Index fell 3.5 per cent to 24,382.47 at the close, the steepest drop since April 7 last year. The Hang Seng Tech Index tumbled 3.3 per cent. On the mainland, the CSI 300 Index slid 3.3 per cent and the Shanghai Composite Index retreated 3.6 per cent.
Laopu Gold tumbled 8.6 per cent to HK$558.50 and Zijin Mining Group lost 5 per cent to HK$32.52 as bullion prices plunged by more than 6 per cent. Alibaba Group Holding fell 3.2 per cent to HK$119.70 and Tencent Holdings slid 1.9 per cent to HK$498.40.
Bank of America scrapped its prediction of two rate cuts in China this year and Dutch bank ING forecast that South Korea might raise borrowing costs as early as May after nominating a more hawkish central bank governor. Meanwhile, the European Central Bank turned more hawkish, reverting to wording that analysts said often preceded interest rate increases. Australia raised its interest rate by 25 basis points last week to reflect higher energy costs.