Shares in Asia Pacific traded lower on Thursday morning following an overnight slip for stocks on Wall Street.
Hong Kong’s Hang Seng index fell 1.01% in early trade. The benchmark index closed 1.73% lower on Wednesday, amid violent clashes between protesters and riot police over a controversial extradition bill.
“You already have significant political risk premium embedded into Hong Kong equities because of the trade effects that are going on and Hong Kong is the gateway to China. So the outlook for China has taken a knock in the past month or so,” Binay Chandgothia, managing director and portfolio manager at Principal Global Investors, told CNBC’s “Squawk Box” on Thursday.
“Add to that the possibility that something wrong could happen in terms of the ongoing protests. Then you could see Hong Kong equities get cheaper,” Chandgothia said, adding that valuation levels in the Hong Kong markets are “fairly attractive” at present.
Mainland Chinese stocks also declined in early trade, with the Shanghai composite slipping 0.31% and the Shenzhen component falling 0.46%. The Shenzhen composite also shed 0.246%.
Elsewhere, the Nikkei 225 in Japan slipped 0.46% in morning trade as shares of Apple supplier Japan Display plummeted more than 10% after the company announced new restructuring plans, with the company’s president and CEO set to step down. The Topix index also declined 1.01%.
MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.84% in the morning.