The Hong Kong stock market on Friday halted the five-day winning streak in which it had jumped more than 850 points or 4.1 percent. The Hang Seng Index now rests just beneath the 20,260-point plateau, and the market may face continued selling pressure again on Monday.
The global forecast for the Asian markets suggests continued and extreme volatility as the world continues to react to Britain's decision to leave the European Union. The European and U.S. markets took heavy damage on Friday, and the Asian markets - which already had a chance to react to the news - figure to open in similar fashion.
The Hang Seng finished sharply lower on Friday following heavy losses across the board - particularly the financials, properties and oil companies.
For the day, the index plummeted 609.21 points or 2.92 percent to finish at 20,259.13 after trading between 19,662.70 and 21,034.18.
Among the actives, CKH Holdings dropped 5.07 percent, while Hong Kong & China Gas added 0.30 percent, HSBC plummeted 6.59 percent, Bank of East Asia skidded 3.72 percent, New World Development lost 1.97 percent, Henderson Land fell 1.67 percent, Galaxy Entertainment shed 3.55 percent, China Petroleum and Chemical (Sinopec) tumbled 3.47 percent, PetroChina plunged 4.43 percent, ICBC retreated 3.15 percent, Bank of China skidded 2.61 percent and China Life slid 3.06 percent.
The lead from Wall Street is brutally negative as stocks moved sharply lower on Friday in reaction to the Brexit vote.
The Dow plunged 611.21 points or 3.4 percent at 17,399.86, while the NASDAQ plunged 202.06 points or 4.1 percent and the S&P 500 dove 76.02 points or 3.6 percent to 2,037.30. For the week, the NASDAQ tumbled 1.9 percent, while the Dow and the S&P 500 both fell 1.6 percent.
The sell-off followed the U.K.'s surprise vote in favor of leaving the European Union on Thursday. In a referendum, the British people voted 52 percent to 48 percent to leave the EU amid substantial turnout of more than 72 percent.
While the Brexit had been discussed intensely across the world in the run up to the poll, the actual decision to leave came as a surprise, sending the British pound to a 31-year low. Global markets were caught off guard and plummeted during the day.
The Brexit vote overshadowed the day's U.S. economic data, including a Commerce Department report showing a bigger than expected drop in durable goods orders in May. A separate report from the University of Michigan showed a fall in consumer sentiment in June.
Closer to home, Hong Kong will provide May figures for imports, exports and trade balance later today. In April, imports were worth HKD316.30 billion and exports were at HKD285.27 billion for a trade deficit of HKD31.03 billion.
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