Hang Seng fell 2 pct, China Enterprises lost 2.5 pct amid recession fear

Hong Kong stocks posted their worst day in nearly three months on Monday, tracking a global sell-off, as investors fled equities on growing fears about a U.S. recession, and on caution ahead of fresh U.S.-China trade talks.

The Hang Seng index fell 2 per cent to 28,523.35 points, its biggest single-day drop since Jan. 2, while the China Enterprises Index lost 2.5 per cent to 11,232.07 points. On Friday, all three major U.S. stock indexes marked their biggest one-day percentage losses since Jan. 3. The Dow slid 1.8 per cent, the S&P 500 was off 1.9 per cent and the Nasdaq dropped 2.5 per cent.

There was also caution ahead of the latest round of trade talks. United States Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin will travel to Beijing for talks scheduled to start on March 28, while a Chinese delegation led by Vice Premier Liu He will visit Washington next week, the White House said on Saturday.

Sectors fell across the board, led by energy firms. The Hang Seng energy index tumbled 4.1 per cent, as China's biggest coal miner China Shenhua plummeted 6.9 per cent after slower profits in 2018.

Around the region, MSCI's Asia ex-Japan stock index fell 1.65 per cent, while Japan's Nikkei index closed down 3.01 per cent. The yuan was quoted at 6.7136 per U.S. dollar at 08:14 GMT, 0.07 per cent firmer than the previous close of 6.718.

The top gainers among H-shares were China Telecom Corp Ltd, up 0.46 per cent, followed by Guangdong Investment Ltd, up 0.27 per cent. The biggest H-shares percentage decliners were Shenzhou International Group Holdings Ltd, which was down 6.98 per cent, China Shenhua Energy Co Ltd, which fell 6.7 per cent and China National Building Material Co Ltd, down by 5.7 per cent. China's A-shares were trading at a premium of 23.30 per cent over the Hong Kong-listed H-shares.