Hong Kong Stocks Fall As Financials, Real Estate Drag

Hong Kong stocks opened lower Monday morning, extending their weakness seen at the end of last week. The Hang Seng Index fell 0.7%, dragged mainly by financial and property stocks. Brokerage firms fell after various media reports said the long-awaited Hong Kong-Shanghai "stock connect" program, which would allow direct share trading between the two markets, may be postponed to the end of this month or even further, possibly due to Beijing's hesitation in granting approval amid Hong Kong's political unrest. Haitong International Securities Group Co. (formerly Taifook Securities) slid 2.1%, both Guotai Junan International Holdings Ltd. and China Everbright Ltd. fell 2% each, First Shanghai Investments Ltd. declined 1.9%, and China Galaxy Securities Co. lost 1.4%. Hong Kong Exchange & Clearing Ltd. , the city's sole exchange operator, dropped 0.7%. Mainland real-estate shares were substantially weaker, with major developer Agile Property Holdings Ltd. diving 19.3% to lead the losses. Agile resumed share trading on Monday following a week-long trading halt, after the company said its Chairman Chen Zhuolin was placed under home surveillance by prosecutors. Mainland media reports said Chen was accused of suspected bribery to government officers for a massive property project in China's southwestern Yunnan province, with the nation's top economic planner and the Ministry of Land and Natural Resources having criticized the firm earlier for building golf courses in the project illegally. Last week, Agile denied in a statement that Chen has any connection with the fallen security tsar Zhou Yongkang, nor did he ever give a villa gift to Hong Kong's former chief executive Donald Tsang, as some alleged. Other developers also suffered susbtantial losses, as Guangzhou R&F Properties Co. Ltd. sank 5.4%, Shimao Property Holdings Ltd. lost 3.4%, and index component China Overseas Land & Investment Ltd. gave up 1.7%. Over on the Chinese mainland, the Shanghai Composite Index dropped 1.2%.