With the latest losses on the Hong Kong Stock Exchange, everyone is wondering when the bull market will return. The Hang Seng Index closed down 767.78 points, or 4.8 percent, to 15,230.52 in Thursday trade. AP

The first two days of this week brought gains and laughter in stock markets throughout the world.

But the last two? Only pain and loss.

Hong Kong shares fell a further 4.8 percent yesterday as a drop in US retail sales heightened concerns that the global economy will slide into a recession.

Still, it could have been worse on the day. Blue chips slid nearly 9 percent at one point, dropping the Hang Seng Index (HSI) to 14,578.54 and luring bargain hunters back into the fray. The market closed down 767.78 points to 15,230.52.

The sell-off and rebound lifted mainboard turnover to HK$64.3 billion, up from HK$52.2 billion on Wednesday.

Global lender HSBC led the slide, falling 2.86 percent to HK$108.50. And index heavyweight China Mobile shed 3.59 percent to HK$69.80.

Yue Yuen Industrial, the world's largest maker of sport shoes, plunged 10.48 percent after US consumer purchases dropped for a third month, making it the HSI's biggest percentage loser. Foxconn International, a contract maker of mobile phones, slumped 7.16 percent to HK$3.11, extending its 6.2 percent slide a day earlier.

"Despite all the money that governments around the world have been pouring into the financial markets, people can still feel the chill of a recession," said Ambrose Chang, chief investment officer with Daiwa SB International. "The real economy will stay in focus, not just in the coming months, but even in the coming year, as unfavorable economic data and falling corporate earnings turn people more and more wary about losing their jobs."

Shares in domestic shipping stocks also sank on fears of what a global recession will do to demand for resources.

China COSCO, the nation's largest shipping conglomerate, plummeted 11.76 percent to HK$4.50. Oil and coal carrier China Shipping Development dropped 25.06 percent to HK$5.89, the lowest in more than two years.

The China Enterprises Index of top locally listed mainland companies fell 6.72 percent to 7,363.39, led by an 8.19 percent decline in top lender ICBC.

The tone for a hefty correction was set by Wall Street's second-worst daily point drop ever - next to Sept 29 of this year.

Major Asian markets joined the slump, with Japan's Nikkei average sliding 11.41 percent and South Korea's KOSPI dropping 9.44 percent.

But the blue-chip index still stayed above last Friday's low of 14,398.54.

Jackson Wong, an investment manager at Tanrich Securities, expects to see strong buying interest from investors if the index falls below 14,000.

"The current trading level would translate to about nine times forward price-to-earnings, which is already very attractive," he said.

Agencies contributed to the story

(HK Edition 10/17/2008 page2)