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Hong Kong stocks ended the morning session lower on Wednesday, amid cautious anticipation ahead of the city’s 2016 budget, as investors adopted a wait and see approach to what incentives will

be laid out in the annual economic blueprint.

Hong Kong Finance Secretary John Tsang Chun-wah kicked off the budget release at 11.00am.

READ MORE: Our live blog as Financial Secretary John Tsang Chun-wah delivers his ninth budget speech

The Hang Seng Index was down 1.6 per cent at midday break on Wednesday, falling to 19,103.70, its lowest it has been since February 17th.

The China Enterprises Index fell even further, dropping 2 per cent to 8,006.95 in the morning session.

Among the big movers, Standard Chartered Bank shares were hammered 6.91 per cent lowering during the session, falling to HK$44.40 a share, after the bank announced a US$2.2 billion loss for 2015, its first in more than a quarter of a century.

Fitch Ratings said Wednesday it has a “negative” rating outlook on the bank, noting that there were downside risks to the management restructuring plans unveiled in November.

“If it can successfully implement its new strategy, the Outlook could be revised but this looks increasingly challenging given the strong external headwinds and the scale of the transformation,”

Fitch’s senior director, banks, Sabine Bauer said.

Ample Capital Asset Management director Alex Wong said indications overnight of a prolonged period of weaker global energy prices and softening global activity, added up to a grim outlook for Hong Kong.

“Overall sentiment is very cautious and actually it is trading with downside bias... we don’t have too much upside,” he said. “People aren’t willing to chase the decline yet but if we see any negative catalysts then we might see a downturn.”

Wong said traders were shorting property stocks in the expectation that the government will not change the status quo on stamp duties designed to cool the property market.

“If things turn out as expected, then the government stays put on these policies, we may see some decline in property stocks,” Wong said. “People are not expecting too much stimulus or other things.”

Across the border, Chinese stocks were much more stable their Hong Kong peers on Wednesday, with the Shanghai Composite Index holding hovering around the 2,900 mark.

It closed the morning session 0.21 per cent lower at 2,897.25. In Shenzhen, the Composite Index fell 0.93 per cent to 1,859.69.

Global stocks were beaten down overnight, weighed by a fall back in crude oil prices after comments by Saudi Arabia Oil Minister Ali al-Naimi quashed hopes for a production cut that could help shore up the balance sheet of energy exporting nations.

In New York on Tuesday the Dow Jones Industrials fell 1.14 per cent to 16,431.78, the S&P 500 ended down 1.3 per cent at 1,921 and the Nasdaq Composite eased 1.5 per cent to 4,504.

Elsewhere around Asia on Wednesday, Tokyo’s Nikkei was down 1.25 per cent at 15,851.13.

On the energy markets, West Texas Intermediate crude for April delivery ended regular US trade down 4.6 per cent, shedding US$1.52 to settle at US$31.87 a barrel on the New York Mercantile Exchange.

Hong

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