Hang Seng

Hong Kong has endured almost daily thunderstorm warnings in recent weeks. On Friday, as markets reopened after a one day holiday, the gloom was clear to see in the equity market. The Hang Seng dropped 2.9 per cent.

Though the spectre of a fresh flu epidemic was cited as the immediate cause, there are deeper currents dragging the Hong Kong market down. 

If you believe in precedent, the Chinese Year of the Snake which begins this weekend could be very bad for your portfolio.

As broker CLSA says in a report, Hong Kong’s Hang Seng index has dropped in four out of the five last Snake years. Worse, Snake years are often marked by shocks, such as the Russian revolution (1917), the Great Depression (1929) and the Twin Towers attack (2001).

But brokers don’t make their living by being gloomy. So CLSA finds reasons why 2013-14 will be different: it’s all down to the basic energies. 

Catch up with the week on beyondbrics, with the ten most popular stories from the blog, a few things we’ve learnt, and a chart. This week: the Hang Seng index. 

Ouch. First the suicides. Then the plant explosion. Now Foxconn International, the scandal-hit Taiwanese company that toils in the shadow of high-profile clients such as Apple, is being stripped of its blue-chip status after it was dropped on Tuesday from Hong Kong’s benchmark Hang Seng index.