Hong Kong shares outlook: Lower on Wall Street/weaker U.S. job market

HONG KONG (AFX-ASIA) - Share prices are expected to open lower on the back of falls in Wall Street last night, with renewed worries about the U.S. economy after its release of higher-than-expected weekly jobless claims, dealers said.	    They said the market will also be weighed down by HSBC, which extended losses in London last night, amid concerns that the bank would ask shareholders to back its share placement proposal.	    Yesterday, the Hang Seng Index was down 96.10 points at 13,718.14, off a high of 13,844.36 and a low of 13,646.22, on trade of 9.81 bln hkd.	    The Hang Seng May contract last traded at 13,654 and the Hang Seng London Reference Index was down 72.50 points at 13,645.64.	    The overnight rate opened at 4.125 pct, compared with 4.0 pct at yesterday's close and the 3-month HIBOR opened at 4.09375 pct, from 4.125 pct previously.	    The base rate remains at 6.0 pct.	    Patrick Yiu, associate director of Kingsway Securities, said the Hang Seng Index will continue to trade downward, following the decline in Wall Street last night.	    "The higher-than-expected U.S. weekly jobless claims will re-ignite worries about the U.S. economy ... this would be negative to sentiment in the local bourse," he said.	    Last night, the U.S. Labor Department said initial claims for regular state unemployment benefits rose 9,000 to a seasonally adjusted 421,000 for the week ended April 28, from a revised 412,000 in the previous week.	    Yiu said selling pressure will continue to hurt HSBC, as it extended losses in London last night, ending down 1.00 hkd at 96.0.	    "Investors are concerned about its share placement and it could be used as an excuse to sell HSBC," he said.	    He said the Hang Seng Index will move between 13,500 and 13,800 points at today's trade.	    Dealers said several telecom stocks will suffer from profit taking after their gains yesterday, with sentiment also hurt by falls on NASDAQ.	    "In particular, China Mobile will be weaker after the fall of its ADS last night. It closed equivalent to 40.17 hkd, (against 41.80 hkd at Hong Kong's close)," a dealer from a local brokerage said. 

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