Hong Kong stocks dipped today after hitting their highest levels at Tuesday's close in 13 weeks.
At the close Wednesday, the Hang Seng Index dropped 170 points to 29,297.62 points. The losers on the benchmarks today were led by power tool maker Techtronic Industries (HKEX: 0669; OTC: TTNDY), and biotech firm WuXi Biologics (HKEX: 2269; OTC: WXXWY), whose stocks both slipped 3%.
The biggest winner on the HSI was automaker Geely Automobile (OTC: GELYF; HKEX: 00175), which finished 6% higher. On Tuesday, it was reported that the joint venture between Geely and internet giant Baidu (NYSE: BIDU; HKEX 9888) would unveil their first car in April 2022.
The sell-off comes after the benchmark hit its highest closing levels on Tuesday since Mar. 3. Stocks have been gaining thanks to China’s strong recovery from the coronavirus pandemic. Since the beginning of April, the HSI is up 2% to date.
But one expert notes that Hong Kong stocks could trend downwards this month on fears of interest rates rising.
“There’s an increasing chance that Hong Kong stocks will be due for a correction in June to follow the trend on US stocks,” Cheng Jiawei, an analyst at Guosen Securities, said as cited by the South China Morning Post.
“A market pullback may be in store, given concerns about Fed tapering and higher interest rates.”
Meanwhile, stocks were up across the board as of intraday Wednesday in the U.S.—boding well for the next day of trading in Hong Kong. The Dow Jones was up 106 points, the S&P 500 gained 14 points, and the Nasdaq Composite added 33 points.
Next up, investors will want to keep an eye out for important U.S. jobs data set to be released on Thursday and Friday.