June 8, 2012 (Chinavestor) Financial stocks dragged down Chinese indexes in Asia on Friday. The Hang Seng Index (INDEXHANGSENG:.HSI) fell 175.9 points or 1.0% while the Shanghai Composite Index (SHA:000001) slid 11.7 points or 0.5%. Chinese financials fell hard after Central Bank of China cut deposit rates by 25 basis point and let banks to set their own lending rates, raising fears that moves will deteriorate margins for the sector.
All five stocks with the largest decline on Friday among the 50 largest components of the Shanghai Composite Index (SHA:000001) came from the financial sector, as the following chart testifies. The worst component of the 42 member Hang Seng Index (INDEXHANGASENG:.HSI) was also a financial stock.
But power generators extended their rally in Hong Kong as price of oil and coal fell, increasing margins. Huadian Power (HKG:1071), Hunaneng Power (HKG:0902) and Datang Power (HKG:0991) were the three best performing components of the Hang Seng Index (INDEXHANGSENG:.HSI).