* HSI -2.7 pct, H-shares -3.1 pct; China shut
* HSCE below 200-day MA for the 1st time since November
* BOJ radical easing triggers Hong Kong outflows
* Airlines sector slump as China bird flu fears escalate
By Clement Tan
HONG KONG, April 5 (Reuters) - Hong Kong shares finished a
holiday-shortened week at their lowest close since Nov. 28, as
fears of a bird flu outbreak sparked a broad selloff, and
further falls looked possible after the benchmark index broke
below a key technical support.
Traders said losses were exacerbated by an exit of funds
after the yen slumped to a 3-1/2-year low following the Bank of
Japan's aggressive monetary easing announced on Thursday, on
which Hong Kong markets were shut for a holiday.
Mainland China stayed shut on Friday for a public holiday
and will resume trading on Monday. Both markets only traded
three days this week, with Hong Kong having also been closed on
Monday for Easter.
The Hang Seng Index ended down 2.7 percent at
21,726.9. News about deaths in China from bird flu triggered
memories of Asia's outbreak of severe acute respiratory syndrome
(SARS) 10 years ago. Due to SARS, the Hong Kong benchmark
slumped 18 percent from a December 2002 peak to an April 2003
The China Enterprises Index of the leading Chinese
listings in Hong Kong dived 3.1 percent on Friday to 10,429.3,
closing below its 200-day moving average, now at about 10,508.9,
for the first time since Nov. 16.
Losses in Hong Kong came as Japanese shares jumped to near
five-year highs and government bond prices rose sharply, with
the long-end of the yield curve inverting as the Tokyo Stock
Exchange twice halted trade in Japanese government bond futures.
The two Hong Kong indexes shed 2.6 and 4.3 percent this
week, respectively, and both closed at their lowest since Nov.
28. The Shanghai Composite Index and the CSI300
of the top Shanghai and Shenzhen A-share listings,
which didn't trade after Wednesday, were down 0.5 percent for
On Friday, Hong Kong's turnover was at its heaviest in more
than two weeks, but was still some 40 percent off a Feb. 4 peak.
Short selling interest accounting for 12.5 percent of total
turnover, higher than the historic 8 percent average.
"Everything is combining today to hurt the market," said
Alfred Chan, chief dealer at Cheer Pearl Investment in Hong
Kong. "The bird flu issue is at the top of people's minds now."
Chinese authorities slaughtered over 20,000 birds on Friday
at a poultry market in the financial hub Shanghai as the death
toll from a new strain of bird flu rose to six, spreading
The strain does not appear to be transmitted from human to
human but authorities in Hong Kong raised a preliminary alert
and said they were taking precautions.
Chinese airlines were the biggest percentage losers on a day
of fears about diminished demand for air travel. Air China
slumped 9.8 percent, its worst single-day loss in
nearly four years.
China Southern Airlines and China Eastern Airlines
each slid more than 8 percent. Hong Kong's Cathay
Pacific Airways fell 4.1 percent to its lowest close
since Sept 6.
Chinese oil majors were also hit by lower oil prices, which
were on course for their biggest weekly decline in a month.
CNOOC Ltd fell 3.9 percent on the day and has now
slumped 14.4 percent in 2013.
CNOOC has underperformed its rivals this year. PetroChina
, after sliding 4.1 percent on Friday, is down 10.3
percent in 2013 China Petroleum and Chemical Corp (Sinopec)
is down 0.3 percent this year after Friday's 3.5
PRADA SINKS BEFORE EARNINGS
Italian luxury brand Prada SpA slipped 1.5 percent
ahead of its 2012 corporate earnings results later in the day.
Up 4.3 percent in 2013, Prada is currently trading at a 14
percent premium to its historic 12-month forward earning
multiple, according to Thomson Reuters StarMine.
In the last 30 days, three out of 30 analysts who cover
Prada downgraded their 2012 final earnings-per-share estimates
by an average of 2.8 percent, according to StarMine.
Of the 91 percent of Hong Kong-listed companies that have
reported earnings, more than half have missed expectations, with
the energy, material, consumer staple and discretionary sectors
among the most disappointing.
Chinese property stocks slumped after the 21st Century
Business Herald newspaper reported on Thursday that about 20
projects in Beijing have been banned from an online property
registration system as authorities step up efforts to tighten
restrictions on the high-end housing market.
China Resources Land slid 4.1 percent to its
lowest in almost two weeks and is now down 0.5 percent on the
year after surging 69 percent in 2012. Chinese property stocks
have been caught in a jittery spell since the central government
announced guidelines for new curbs at the start of March.