Hong Kong Stocks Fall After China Inflation Data

Hong Kong stocks widened their losses Tuesday morning after China's May consumer inflation showed its first slowdown this year. The Hang Seng Index dropped 0.6%, with the mainland-China-tracking Hang Seng China Enterprises Index off 0.5%. Official data released at the market open showed China's May consumer prices rising 1.2% from a year earlier, down from a 1.5% increase in April and missing a 1.3% forecast from a Wall Street Journal survey. Producer prices in May fell 4.6% from a year ago, matching April's rate of decrease. Among major movers, train maker CRRC Corp. sank 8.2%, erasing a 4.5% rally at its trading debut the previous day. The company agreed to subscribe to 6.5 billion new shares from China Properties Investment Holdings Ltd. for 650 million Hong Kong dollars ($85 million) in a share-placement deal, according to a statement by China Properties Investment. Shares of China Properties Investment tumbled 23%. Other rail stocks also declined broadly, as China Railway Group Ltd. slid 3%, China Railway Construction Corp. lost 2.6%, Zhuzhou CSR Times Electric Co. fell 1.2%, and China Communications Construction Co. retreated by 0.6%. Macau gaming stocks suffered broad-based losses, with investment bank Barclays projecting earlier in the day that Macau casinos' average daily table revenue dropped sharply in the first seven days of this month. Melco Crown Entertainment Ltd. sagged 4.7%, Wynn Macau Ltd. shed 4.1%, and Galaxy Entertainment Group Ltd. traded 2.1% lower. Over on the Chinese mainland, the Shanghai Composite Index was down 0.1% but well off its lows immediately after the price data.