October 27: Hong Kong stock crashes down 12.7 percent

Hang Seng Index in Hong Kong nosedived 15.4 percent in afternoon trade as fears grow that the global credit crisis will engulf the cities financial and exports services. The Hang Seng Index finally closed at 11,015.84 a drop of 1,602.54 or 12.7 percent making it the biggest fall since October 28 1997.

Hong Kong analysis predict the country will be in recession in 2009 due to the stocks and other assets declining adding that the economic growth slowing to between 4 and 5 percent this year which is a massive decline from last year’s 6.4 percent economic growth.

Hong Kong’s government injected $2 billion into its banking system today to stop its currency from expanding beyond its fixed rate of exchange to the dollar.

Looking at Asian Stocks, Aluminum Corp. of China Ltd dropped 13 percent with Industrial & Commercial Bank of China Ltd slumping 11 percent which led the fall among financial stocks.

Source: Bloomberg