US Rate-hike Fears Sink HK, Mainland Market Gains

Hong Kong stocks sank on Thursday following Wall Street losses with traders fretting over the prospect of high US interest rates, though mainland markets surged as they reopened after a week-long Lunar New Year break.

The Hang Seng Index slipped 1.5 percent, to close at 30,965.

The benchmark Shanghai Composite Index jumped 2.2 percent, to 3,268 and the Shenzhen Composite Index advanced 1.9 percent, to 1,771.

Tokyo ended 1.1 percent lower, and Singapore was off 0.5 percent. Seoul shed 0.6 percent, Taipei was off 0.5 percent and Manila dropped 1.4 percent. Jakarta and Bangkok both fell.

There were also gains in Sydney, Kuala Lumpur and Wellington.

Reports that Federal Reserve minutes indicate US interest rates would rise further saw the key 10-year US Treasury yield hit a four-year high and boosted the US dollar.

Investors have been on edge since the start of this month when global markets were sent spinning by a strong US jobs and wages report that fuelled talk of tighter borrowing costs. (AFP)