Hong Kong Stocks Dip As Virus Fears Persist

The Hong Kong market failed to hold onto its early gains and closed in the red on Wednesday, as investors continued to move to safe haven assets in view of the global spread of the Delta coronavirus variant.

The Hang Seng Index took the cue from Wall Street and started 79 points higher, but then reversed course to sink nearly 300 points to sub-27,000 levels.

However, a number of stocks rallied to help the benchmark pare most of its losses to finish 34 points, or 0.1 percent, lower at 27,224, on turnover of HK$156.9 billion.

Among the contributors to the recovery was Hong Kong Exchanges and Clearing, which jumped 2.7 percent.

Mainland automakers surged, after Great Wall Motor reported that its interim net profit soared more than 200 percent. Great Wall Motor Company rallied 16.2 percent. BYD Company advanced 6.1 percent. Geely Auto added 2.2 percent.

Smartphone equipment maker Sunny Optical rose 6.4 percent to become the blue-chip winner of the day.

The worst performer on the benchmark was Wuxi Biologics. The biotech firm sank 4.5 percent after a shareholder dumped 80 million of its shares.

Tech shares were also under pressure. Xiaomi lost 2.7 percent. Meituan shed 1.8 percent.

Beijing's cyberspace regulator announced that it will fine units under Tencent, Alibaba, as well as Weibo and Kuaishou for spreading child-related obscene content. Tencent slipped 0.8 percent. But Alibaba inched up 0.1 percent. Kuaishou declined 2.2 percent.

Markets across the border finished in positive territory. The Shanghai Composite Index and the blue-chip CSI300 index each put on 0.7 percent. Shenzhen's Nasdaq-style ChiNext jumped almost three percent to a six-year high. The Shenzhen Composite rose 1.3 percent.

Markets elsewhere headed in different directions. Japan's Nikkei edged up 0.6 percent after the country reported a jump in June exports ahead of a long weekend marking the start of the Tokyo Olympics.

Singapore was 0.3 percent firmer. Australia was up 0.8 percent. But the Kospi in South Korea gave up 0.5 percent. Taiwan was down 0.4 percent.