Protests hit Hong Kong banks, travel and business
Published on: Tuesday, September 30, 2014
HONG KONG: Hong Kong's shares tumbled Monday and the local dollar hit a six-month low against the greenback as pro-democracy protests brought parts of the city to a standstill with many schools, businesses and banks shut down.As demonstrators refused to back down on their demands for Beijing to grant the city universal suffrage, fears of a long stand-off saw investors sell off major banks including HSBC and Standard Chartered.In response, the city's stock exchange said trading would continue as normal and the central bank sought to reassure investors, while it also announced it would make liquidity available to support the banking system. However, the Hang Seng Index sank 2.20 per cent at one point before paring some of the losses to sit 1.94 per cent lower by the break.
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A report by New York-based advisory firm JL Warren Capital said: "We are likely to see (a) major sell-off and volatility for days to come" in the Hong Kong stock market.It said those likely to be hurt most would be Hong Kong-listed retailers such as luxury businesses selling products purchased by mainland tourists, and local and Macau tourism businesses.Sunday's unrest was the worst since the handover in 1997 and saw police fire volleys of teargas into crowds of thousands.While the trouble had subsided by Monday morning, crowds of defiant demonstrators still controlled a number of major thoroughfares and intersections in the heavily congested city.
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An AFP reporter on the scene in Mongkok – one of the most densely populated suburbs of the city and the site of a second protest across the harbour in Kowloon – saw angry confrontations between protestors and members of the public frustrated at the disruption. Banks, jewellery shops and clothes stores in the busy shopping district remained closed.
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The Transport Department said more than 200 bus routes were suspended or diverted while central sections of the tram network were also down. The city's underground rail service was largely unaffected but multiple station exits in the busy island districts of Causeway Bay and Admiralty – where many international businesses are located – were closed after protesters blocked them with barricades. Some exits at Mongkok were also blocked.The stock exchange insisted it would continue to operate as normal but the Hong Kong Monetary Authority said 17 banks were forced to close 29 branches across the city.Standard Chartered, HSBC Holdings, Bank of East Asia, the Bank of China and CITIC were among those who said their operations were affected by the protests.In a bid to limit the impact of the protests on the markets the HKMA said: "The Hong Kong interbank markets will function normally today. The Currency Board mechanism will also function normally to maintain the stability of the Hong Kong dollar exchange rate. "The HKMA will also inject liquidity into the banking system as and when necessary under the established mechanism."However, the Hong Kong dollar suffered a sell-off in early exchanges, slipping to 7.7623 against the greenback – its lowest since March. The dollar is pegged to the greenback but can move within a band of 7.75 to 7.85.Stay up-to-date by following Daily Express’s Telegram channel.
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