Hong Kong Shares Closes Flat as US prepares to release Inflation Data

HONG KONG, Sept. 13 – Hong Kong shares closed flat to negative territory as investors are cautious over the latest US inflation data that will be released later today.

The Hang Seng Index marginally fell to 18,009.22 at the end of Wednesday’s trade. The Hang Seng China Enterprises Index lost 0.4%, or 24.48 points, to 6,235.71.

According to MT Newswire, the US consumer price index report for August is bound to be announced today. Core CPI is expected to decline year on year to 4.3% from 4.7%, while headline inflation is expected to be at 3.6% due to energy cost hikes, according to Reuters.

The latest inflation index may determine the course for the Federal Reserve’s next monetary policy on Sept. 20. The rise in oil prices, which climbed about 2% on Tuesday to an almost 10-month high, may add to the possibility of the Fed considering hiking rates.

Shares of property developers like Sunac China Holdings and Guangzhou R&F Properties, which jumped 3.9% and 8.4% at the close, respectively, rose following China’s rule changes that reduced mortgage interest rates, which will be effective Sept. 25. Despite the roll-out of government measures, investors fear that China’s real estate sector would be the top source for the next global credit event amid developers’ struggle in extending repayments, according to a survey by Bank of America.