Pro-Democracy Unrest in Hong Kong Weighs on UK Banks and Miners

Support: +44 (0) 203 301 0483 | support@financialspreads.com
Financial Spreads: Spread Betting and CFD Trading
Pro-Democracy Unrest in Hong Kong Weighs on UK Banks and Miners

Pro-Democracy Unrest in Hong Kong Weighs on UK Banks and Miners



The FTSE 100 has taken another fall following the continuation of political unrest in Hong Kong.

Britain's top share index fell by 15.19 points, or 0.2%, to 6,634.20 points, having hit its lowest level since early August on 26 September.

Last week, the index dropped by 2.8%, meaning that it is now trading almost 2% down for the year to date.

Meanwhile, the UK mining index fell 0.7% as copper prices fell to their lowest level in almost three months, with uncertainty over China's growth prospects coinciding with a sharp rise in the value of the US dollar.

The former British colony has experienced its most notable unrest in two decades over the last few days, as pro-democracy protesters have taken to the streets of the special administrative region to clash with local police.

As a result, many normal economic and social functions, including schools and banks, have been temporarily closed, created a significant impact on the Hong Kong index and the Asian region as a whole.

Investors have therefore acted to trim their exposure to companies with a strong presence in Asia, including Standard Chartered and HSBC, as well as the mining companies Rio Tinto and BHP Billiton.

As such, the valuation of all of these organisations has taken a hit in the last few days.

Keith Bowman, Equity Analyst at Hargreaves Lansdown, said: 'Events in Hong Kong are unfortunately adding to pre-existing nerves with regards to the outlook for China, a key export market for the miners.'

Jeremy Batstone-Carr, Head of Private Client Research at Charles Stanley, added: 'It's clear that disruption is weighing on investor sentiment.

The longer disruption continues the more likely its impact will become material for businesses with exposure to the former colony.'




By Jonathan Sudaria, 29 September 2014


Contact Customer Support

+44 (0) 203 301 0483
support@financialspreads.com

Also see:
73% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.
Spread betting & CFDs trading are complex instruments & come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading these products with this provider. You should consider whether you understand how these products work & whether you can afford to take the high risk of losing your money. Click here to see the risk warning notice.