UK Banks Rating Downgrade Weighs on Hang Seng Index; HSBC Falls 1.1% — Market Talk

0333 GMT [Dow Jones] Hong Kong’s Hang Seng index is down 0.8%, dragged by declines in finance, utilities and property stocks. Banking heavyweight HSBC Holdings PLC (0005.HK) is down 1.1% while fellow U.K. lender Standard Chartered PLC (2888.HK) is off 0.3%, after S&P downgraded six U.K. banks “as a result of the growing risk of adverse economic developments and economic uncertainty arising from the recent Brexit vote.” The weakening of the pound against the dollar isn’t helping either. HSBC contributed 22 points to the Hang Seng Index’s 178-point decline. That’s followed by HSBC unit Hang Seng Bank Ltd. (0011.HK) and Bank of East Asia Ltd. (0023.HK), index compiler data showed. Utility stocks are being sold as investors reallocate their portfolios to take positions ahead of U.S. payrolls data due later Friday. However, these investors might want to pay attention to a Nomura note, which says that, even if June non-farm payrolls exceed the street forecast of an increase of 180,000 jobs, investors would still see the labor market as lacking enough vigor to support a U.S. rate hike in September, potentially prompting selling in the greenback. (kenan.machado[a]

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