The Hong Kong stock market has moved lower in two straight sessions, slumping almost 340 points or 2 percent in that span. The Hang Seng Index now sits just above the 17,650-point plateau and its likely in store for more pain on Wednesday.
The global forecast for the Asian markets is broadly negative on concerns over the global economy. The European and U.S. markets were sharply lower and the Asian bourses are tipped to follow suit.
The Hang Seng finished slightly lower on Tuesday following losses from the financials and mixed performances from the properties and technology stocks.
For the day, the index lost 40.48 points or 0.23 percent to finish at 17,651.49 after trading between 17,583.70 and 17,725.51
Among the actives, Alibaba Group climbed 0.75 percent, while Alibaba Health Info slumped 1.01 percent, ANTA Sports advanced 0.73 percent, China Life Insurance sank 0.51 percent, China Mengniu Dairy gathered 0.31 percent, China Resources Land increased 0.48 percent, CNOOC rose 0.47 percent, CSPC Pharmaceutical jumped 1.90 percent, Galaxy Entertainment shed 0.33 percent, Haier Smart Home surged 2.76 percent, Henderson Land lost 0.21 percent, Hong Kong & China Gas retreated 1.43 percent, Industrial and Commercial Bank of China tumbled 2.06 percent, JD.com fell 0.19 percent, Lenovo perked 0.11 percent, Li Auto declined 1.06 percent, Li Ning improved 0.56 percent, Meituan soared 2.24 percent, New World Development was up 0.29 percent, Techtronic Industries added 0.65 percent, Xiaomi Corporation gained 0.63 percent, WuXi Biologics rallied 1.10 percent and CITIC, Hang Lung Properties and ENN Energy were unchanged.
The lead from Wall Street is brutal as the major averages opened firmly in the red and only got worse as the day progressed.
The Dow plunged 626.15 points or 1.51 percent to finish at 40,836.93, while the NASDAQ plummeted 577.33 points or 3.26 percent to close at 17,136.30 and the S&P 500 tumbled 119.47 points or 2.12 percent to end at 5,528.93.
The sell-off on Wall Street came after the Institute for Supply Management noted continued decline by U.S. manufacturing activity in August. A separate report from the Commerce Department unexpectedly showed a modest decrease by U.S. construction spending in July.
The weakness on Wall Street also came as some traders look to cash in on the previous sessions gains amid lingering uncertainty about the outlook for interest rates.
The Federal Reserve is almost universally expected to lower rates at its next meeting later this month, but there is some disagreement about the pace of rate cuts. According to CME Groups FedWatch Tool, there is a 63.0 percent chance of a quarter-point rate cut later this month and a 37.0 percent chance of a half-point rate cut.
Oil prices fell sharply to a nine-month low on Tuesday on prospects of oversupply from OPEC weighed on oil prices. West Texas Intermediate Crude oil futures for October ended down by $3.21 or 4.4 percent at $70.34 a barrel.