BlackRock cuts Hong Kong investment
BlackRock Inc. had reduced its investment in Hong Kong. This was after the company had bet on the city's equity and property markets that would trail other Asian countries. The investment reduction was a move as the growth had slowed down in two of the biggest economies in the world.
The stocks in Hong Kong might underperform as the US pares stimulus and China tightens its credit. This was according to the head of Asian equities at BlackRock Andrew Swan. Swan managed USD3.86 trillion as of June 30. He also added that home values in the city might fall more than 10% into 2014 in the middle of government measures to curb prices and rising US interest rates.
In an interview, Swan said, "Hong Kong is in a challenging position at the moment. You've had very strong liquidity as China leveraged up and you've had very low cost of credit because of the currency situation. Now both of those things are changing."