Hong Kong Shares Drop on Profit Taking; China Mobile Leads Losses

Hong Kong shares dropped Wednesday for the third straight session, dragged by profit-taking in China-related companies after recent strong gains. China Mobile led the decline.

The blue chip Hang Seng Index fell 98.01 points, or 0.45 percent, to 21,705.56.

"The market is in a correction phase with investors locking in their profits after recent gains. But selling pressure has eased off a bit," said Castor Pang, a strategist at Sun Hung Kai Research Ltd.

The Hang Seng Index gained 982 points in just four days last week. The stock market was closed last Tuesday for a public holiday.

China Mobile (Hong Kong) Ltd., the second largest constituent of the benchmark index, fell 1.6 percent to HK$83.45 Wednesday on profit-taking. China Mobile shares are up 14.3 percent this month even including Wednesday's loss.

Other mainland shares also edged lower. Sinopec, Asia's largest refiner by output, continued to be weighed down by the surprise resignation of its chairman Chen Tonghai over the weekend. The company extended its decline for a third day, with shares down 0.7 percent to close at HK$8.76.

CNOOC Ltd. slipped 1.63 percent to HK$8.46, and Petrochina lost 0.7 percent to HK$11.34.

Conglomerate Shun Tak Holdings rose 1.8 percent to end at HK$11.02, after saying Wednesday it will buy the remaining 75 percent stake that it doesn't already own in a Macau property project.

Analysts said the deal will be beneficial in the long term for Shun Tak -- controlled by Macau gambling tycoon Stanley Ho -- because it will boost the company's exposure to Macau's booming property market.

Stock Exchange of Hong Kong: http://www.hkex.com.hk