Investment funds pulled out as much as HK$30 billion from Hong Kong’s stock market last month amid geopolitical risks, a sluggish economic recovery and policy uncertainties, Morgan Stanley estimates.
Among the stocks, JD.com (9618), AIA (1299), and Yum China (9987) were heavily sold but investors increased stakes in Tencent (0700) and Alibaba (9988).
China and Hong Kong equities saw a combined net outflow of US$3.8 billion (HK$29.6 billion) from active long-only managers last month, the worst month in 2023 and the third-largest monthly outflow on record, Morgan Stanley’s quantitative research team said in a report.
Of the US$3.8 billion outflow in December, US$2 billion was attributable to investor redemptions from funds, while the rest was driven by fund managers rebalancing out of the country, the investment bank said.
Yesterday, Hong Kong’s Hang Seng Index fell for the second trading day this week by 0.85 percent to 16,646 points with a daily turnover of less than HK$80 billion.
Though the tech gauge lost 1.84 percent, both Tencent and NetEase (9999) ended around 1 percent higher than the previous close on Beijing’s reported dismissal of the publicity department head after the drafted video games rules sparked turmoil.
In addition, Tencent spent another HK$1 billion to repurchase 3.36 million shares yesterday.
The overall market was dragged down by local developers. MTR Corp (0066) and New World Development (0017) dropped 4.2 percent and 2.6 percent respectively after Citi downgraded their shares and slashed the target prices.
In money markets, the onshore yuan plunged 114 basis points to 7.1431 per US dollar, a new weekly low.
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