Global tech woes hit Hong Kong stocks, China down on services survey

Investors look at computer screens showing stock information at a brokerage house in Shanghai on April 14, 2014. Hong Kong stocks fell on Wednesday as concerns on property and tech valuations hurt investor confidence after a United States tech sell-o
Investors look at computer screens showing stock information at a brokerage house in Shanghai on April 14, 2014. Hong Kong stocks fell on Wednesday as concerns on property and tech valuations hurt investor confidence after a United States tech sell-off triggered by a steep drop in Twitter's share-price. -- FILE PHOTO: REUTERS

BEIJING (Reuters) - Hong Kong stocks fell on Wednesday as concerns on property and tech valuations hurt investor confidence after a United States tech sell-off triggered by a steep drop in Twitter's share-price.

China shares were also weak after a private survey showed that growth in the country's service sector slowed, though property stocks marginally outperformed.

By midday, the Hang Seng Index was down 1.1 per cent at 21,738.66 points. The China Enterprises Index of the top Chinese listings in Hong Kong dropped 0.8 per cent.

The CSI300 index of the largest Shanghai and Shenzhen A-share listings was down 0.4 per cent, as was the Shanghai Composite Index, at 2020.38 points.

In New York overnight, shares of Twitter fell 18 per cent.

US tech woes spilled over into Hong Kong, with the HSI information technology subindex down 3.2 per cent to its lowest level since Dec 27 amid persisting global concerns about overvaluations in the sector.

"It's a sentiment thing. Overnight we had across the board selling in the US triggered by Twitter," said Alex Wong, a director at Ample Finance Group, who pointed out that even social media platform YY Inc shares fell in the US, despite the firm issuing encouraging earnings.

Index heavyweight Tencent Holdings was down 3.5 per cent. The stock came under extra pressure after its main rival Alibaba filed its initial public offering prospectus in the US on Tuesday, bringing the Chinese tech giant a step closer to listing.

But movement on the Alibaba IPO provided a boost for Wasu Media Holding, which jumped 5.7 per cent. Alibaba founder Jack Ma and other partners own 20 per cent in the firm.

The Hong Kong real estate subindex dropped 1.9 per cent, as investors worried about local demand for housing and exposure to the sector in the mainland.

China Resources Land was down 5.1 per cent and China Overseas Land and Investment lost 4.0 per cent. Wharf Holdings shed 3.1 per cent.

Mainland stocks slackened across the board, after the Markit/HSBC services Purchasing Managers' Index (PMI) showed growth in the sector slipped to 51.4 in April from March's 51.9, adding to an increasingly cloudy outlook for the world's second-largest economy.

But mainland property shares marginally outdid the main indexes, falling just 0.1 per cent, after having lost 5.4 per cent over the previous four days as evidence of distress in the sector grew.

Shares of China Railway Construction Corp rose 3.3 per cent in Shanghai to their highest in three weeks, and gained 0.7 per cent in Hong Kong after the railway builder said it signed a US$13.1 billion deal for a high-speed railway in Nigeria.