Hong Kong shares close lower after Bhutto's death, weak Asian markets

Hong Kong shares closed Friday lower after the assassination of Pakistani opposition leader Benazir Bhutto and bleak US economic data triggered a sharp fall on Wall Street overnight.

Bhutto's death raised concerns about growing geopolitical instability in the region, which could push oil prices above 100 dollars per barrel.

Adding to the gloom, the US government said orders for durable goods - big-ticket items from commercial jetliners to home appliances - rose by just 0.1 percent in November, far below the 2.2 percent economists were expecting.

The Labour Department said the number of workers seeking unemployment benefits showed a surprise increase last week. Jobless claims rose a seasonally adjusted 1,000 to 349,000. Economists had expecting the figure would fall to around 340,000 for last week.

"Hong Kong was tracking the overnight losses on Wall Street and the weaker close in Japan. Thursday's data raised more concerns over reduced consumer strength in the US and a likely economic slow down in 2008," said Howard Gorges, vice chairman at South China Securities.

The Hang Seng Index closed 472.33 points or 1.7 percent lower at 27,370.60. The Index lost nearly 1 percent since last Friday's close in weak holiday trade.

Turnover stayed low at 78.22 billion Hong Kong dollars.

Shares of Bank of East Asia rose 1.42 dollars or 2.7 percent to 52.90 dollars following news its Spanish stakeholder increased its stake in the bank to 8.9 percent. BEA said it will use the nearly 4 billion dollars that it raised from the sale of new shares to expand in mainland China.

(1 US dollar = 7.80 Hong Kong dollars)