Hong Kong equities sink as 10-year Treasury yield hits two-decade high

HONG KONG, Oct 2 (Reuters) - Hong Kong stocks posted their steepest one-day decline in more than six months on the first trading day of October, as a surge in the 10-year US Treasury yield to a more-than-two-decade high and rising oil prices weighed on risk sentiment.

** At the close, Hong Kong benchmark Hang Seng .HIS lost 2.6%, its biggest single-day loss since March 2026.

** The Hang Seng China Enterprises Index .HSCE and the Hang Seng Tech .HSTECH both fell more than 2%.

** Financial .HSCIF and biotech .HSBIO stocks were among the biggest laggards.

** Heavyweight insurer AIA 1299.HK tumbled 6%, while banking giant HSBC shed more than 5%.

** Global bonds came under heavy selling pressure ​on Thursday, pushing borrowing costs in the United States, France and Japan to multi-decade highs and heightening concerns about further volatility across financial markets.

** Higher rates tighten market liquidity, especially in interest-rate-sensitive markets like Hong Kong.

** Macau gaming stocks listed in Hong Kong declined broadly with Galaxy Entertainment 0027.HK declining 4%, as the city's gaming revenue continued to fall in September.

** Lack of southbound inflows from mainland also weighed on Hong Kong's market, market participants said.

** China's onshore financial markets are closed from October 1 until October 7 for the National Day holidays. Trading will resume on October 8.