Hong Kong Stocks Lose 777 Points By Noon

Hong Kong stocks sank in the morning session Monday, as the financial hub started the week with a widespread chaos caused by the ongoing campaign against the Hong Kong government and yuan fell sharply sending trade war fears soaring.

The Hang Seng Index dropped 2.9 percent, over 777 points, to 26,140.

On the mainland, the Shanghai Composite Index dropped 0.8 percent, to 2,844 while the Shenzhen Composite Index shed 0.4 percent, to 1,533.

Most other Asian markets plummeted as the yuan fell sharply, days after US President Donald Trump's vow to impose fresh tariffs on goods from China sent trade war fears soaring.

Tokyo and Seoul shed 2.4 percent while Shanghai fell 0.8 percent. Singapore dropped 1.9 percent while Taipei and Bangkok were also down.

"China is likely to drag out their response and retaliate in many ways against the US trade measures," warned Edward Moya, senior market analyst at Oanda.

Although negotiators from both nations are expected to reconvene in Washington in early September for another round of talks after last week's discussions in Shanghai, investors remain nervous, Moya said.

"Financial markets are still working on pricing in a complete collapse of trade talks amongst the Chinese and Americans," he said.

"The base case still remains for a deal to get done, but talks are likely to get a lot messier before we see anything... that resembles a deal." (AFP)

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