Hong Kong Markets Jittery; Shares Tumble

The blue chip Hang Seng Index fell 613.27 points, or 2.3 percent, to 26,004.92 after earlier rising as much as 1.4 percent to 27,004 points.

Hong Kong stocks have been volatile of late with the index falling 17 percent since the beginning of the month. On Oct. 30, the Hang Seng Index hit a record high of 31,638.22.

Analysts said the market may correct more in the coming sessions amid the murky outlook for the U.S., a key export market and the world's biggest economy.

"Buying interest is weak, with trading volume staying inactive amid caution with the U.S. markets off today for (the Thanksgiving Day) holiday," said Castor Pang, a strategist at Sun Hung Kai Financial.

Economic data in the U.S. released overnight showed a drop in consumer sentiment, with the Conference Board's Index of Leading Economic Indicators, designed to be a barometer of future trends, falling 0.5 percent in October vs. a 0.1 percent increase in September.

"There still is a lot of uncertainties in the U.S. economic outlook, as well as on China's macro policies, that could dampen buying interest in the near term," said Peter Lai, a director at DBS Vickers.

Mainland Chinese stock markets fell sharply Thursday on expectations of further economy-cooling measures, with the Shanghai Composite Index falling 4.4 percent to 4,984.16. Analysts said the correction contributed to the fall in Hong Kong stocks by the afternoon session.

Leading the day's blue chip decline was port operator China Merchants Holdings, which fell 7.2 percent to HK$40.05. Rival Cosco Pacific also fell 6.1 percent to HK$19.02.

The recent pullback offered a good opportunity to buy China Mobile shares, given the company's strong user growth, brokerage UOB KayHian said.

China Mobile, which has the largest weighting on the Hang Seng Index fell 1.9 percent to HK$126.50. Its fellow heavyweight HSBC Holdings fell 1.2 percent to HK$130.20.