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Continued Consolidation Called For Hong Kong Bourse

The Hong Kong stock market has alternated between positive and negative finishes through the last 11 trading days since the end of the two-day winning streak in which it had gathered more than 230 points or 0.9 percent. The Hang Seng Index now rests just above the 24,700-point plateau and it's looking at another red light on Monday.

The global forecast for the Asian markets is soft on rising tensions between the United States and China. The European and U.S. markets were down and the Asian bourses figure to open in similar fashion.

The Hang Seng finished sharply lower on Friday following losses from the financials, casinos and oil and insurance companies - while the property sector was mixed.

For the day, the index plunged 557.67 points or 2.21 percent to finish at 24,705.33 after trading between 24,598.46 and 25,101.10.

Among the actives, Wharf Real Estate plummeted 5.72 percent, while Tencent Holdings plunged 5.21 percent, CSPC Pharmaceutical tanked 4.84 percent, Techtronic Industries tumbled 4.31 percent, China Life Insurance skidded 4.26 percent, Sands China retreated 4.10 percent, AAC Technologies declined 4.01 percent, China Mengniu Dairy surrendered 3.62 percent, Galaxy Entertainment sank 3.38 percent, WH Group dropped 2.72 percent, CITIC shed 2.67 percent, China Resources Land lost 2.36 percent, BOC Hong Kong fell 2.01 percent, Ping An Insurance slid 1.59 percent, CNOOC dipped 1.50 percent, AIA Group slipped 1.30 percent, Industrial and Commercial Bank of China sank 1.27 percent, Hong Kong & China Gas dropped 1.25 percent, China Mobile climbed 1.04 percent, New World Development added 0.54 percent, Sun Hung Kai Properties shed 0.27 percent, Power Assets Holdings rose 0.24 percent and Hang Lung Properties and China Petroleum and Chemical (Sinopec) were unchanged.

The lead from Wall Street is soft as stocks opened lower on Friday and remained firmly in the red throughout the session.

The Dow shed 182.41 points or 0.68 percent to finish at 26,469.89, while the NASDAQ lost 98.22 points or 0.94 percent to end at 10,363.18 and the S&P 500 fell 20.03 points or 0.62 percent to close at 3,215.63. For the week, the Dow sank 0.8 percent, the NASDAQ fell 1.3 percent and the S&P eased 0.3 percent.

The weakness on Wall Street also came amid concerns about rising tensions between the U.S. and China after Beijing decided to revoke the license for the establishment and operation of the U.S. Consulate General in Chengdu.

The move comes just days after the U.S. government ordered China to close its consulate in Houston, Texas, amid accusations Chinese diplomats aided in economic espionage and the attempted theft of scientific research.

Worries about the continued spike in coronavirus cases also generated some negative sentiment, with daily new cases rising in the U.S. by at least 5 percent in 25 states.

Crude oil prices edged higher Friday as stronger than expected economic data from Europe and the U.S. helped ease worries about energy demand outlook. West Texas Intermediate crude oil futures for September ended higher by $0.22 or 0.5 percent at $41.29 a barrel.

Closer to home, Hong Kong will see June numbers for imports, exports and trade balance later today. In May, imports were down 12.3 percent on year, while exports sank 7.4 percent and the trade deficit was HKD13.7 billion.

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