Hong Kong shares seen weaker as U.S. fiscal woes loom

Thu Nov 8, 2012 6:41am IST

HONG KONG, Nov 8 (Reuters) - Hong Kong shares could start
lower on Thursday, tracking steep losses on Wall Street as
investors shift their focus to the looming "fiscal cliff" that
confronts the U.S. economy and to Europe's economic problems.
    The Dow industrials lost more than 300 points in a sell-off
on Wednesday that drove all major U.S. stock indexes down more
than 2 percent in the wake of the presidential
election. 
    China formally commences its once-in-a-decade political
transition when the 18th Communist Party Congress meeting starts
later in the day, where the country's fifth generation of
leaders will be appointed and could shed more light on its
likely policy direction.
    Chinese PC maker Lenovo and Macau casino Sands
China are among companies expected to report
third-quarter earnings later in the day.
    On Wednesday, the Hang Seng Index closed up 0.7
percent at 22,099.9 in its strongest turnover of the week,
creeping back towards its 2012 closing high of 22,111.3 recorded
last Friday. 
    Elsewhere in Asia, Japan's Nikkei was down 1
percent, while South Korea's KOSPI was down 0.5 percent
at 0048 GMT.
    
    FACTORS TO WATCH:
    * HSBC  is nearing the sale of more than $6
billion of U.S. mortgages and other personal lending as part of
its accelerated run-down of its troubled U.S. loans book.
 
    * China will launch a campaign to shut down small and
illegal mines in a bid to improve safety and efficiency in the
sector, the government said on Wednesday. The clampdown could
cause a temporary fall in domestic supplies and boost its
reliance on imports. 
    * China's plan to buy base metals for state reserves in an
effort to cushion domestic smelters from slowing economic growth
would support prices but would not significantly reduce bulging
stockpiles, traders and analysts said on Wednesday.
 
    * Hong Kong sold two plots of land for residential use on
Wednesday for a total of HK$5.4 billion ($697 million), stepping
up supply in the latest move to cool the city's housing prices,
which are among the highest in the world. Sun Hung Kai
Properties Ltd and Cheung Kong (Holdings) Ltd
 confirmed they had each bought a site. 
   
    * Taiwan's Foxconn Technology Group said on Wednesday the
company's flagship Hon Hai unit is finding it
difficult to cope with the massive demand for Apple Inc's
 iPhones. However, its chairman declined to comment on
brokerage reports saying that the group's other unit, Foxconn
International Holdings (FIH), had taken on some
production. 
    * Melco Crown Entertainment  posted a 4
percent drop in third-quarter revenue due to lower volume in
Macau's lucrative VIP market that depends on high-stake
gamblers. 
    * China Taiping Insurance Holdings Co Ltd said it
plans to issue U.S. dollar denominated notes, raising capital
for general corporate purposes. It also said its parent China
Taiping Insurance Group is contemplating a restructuring and may
inject its assets into the company. In another statement, the
Chinese insurer also reported that its unaudited accumulated
premium income of its life insurance business rose to 29.7
billion yuan for January-October period a year ago from 26.5
billion yuan.and* Galaxy Entertainment Group Ltd said investors
ENB Lux 1 S.àr.l and ENB Lux 2 S.àr.l, special purpose vehicles
owned by funds advised by Permira, have agreed to the sale of
all their 249.6 million shares or 5.94 percent stake in the
company through a private placement on Nov. 7 with completion
expected to be on Nov. 12.(Reporting by Clement Tan and Donny Kwok; Editing by Chris
Gallagher)
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