Hong Kong stocks fall on China inflation worries

Hong Kong's stock market erased early gains to close lower Monday on worries about China's economy after a report showed the country's wholesale price inflation soared to its highest level in 12 years. The blue-chip Hang Seng Index lost 25.87 points, or about 0.1 percent, to finish at 21,859.34 points. The benchmark was as high as 22,235.51 at one point. The market's mood soured after the Chinese government said the producer price index, or PPI, rose 10 percent in July from a year earlier, the highest rate of increase since 1996. The data added to worries that Beijing will take more credit-tightening measures to control inflation. Mainland China markets wilted on the news, with Shanghai's main index falling 5.2 percent, and Hong Kong followed suit. "We got hit on the head with the PPI," said Francis Lun, general manager of... [read full story]