Those big gainers in Wednesday's surge on a hopeful moment about quieting unrest in Hong Kong broadly fell on Thursday, with Sa Sa International plunging 7.9 per cent.
The olive branch extended by city leader Carrie Lam " saying she would formally withdraw the radioactive bill that would have allowed extraditions to the mainland " fell far short of protesters' demands. Violence broke out again at an MTR subway station, in which a station superviser was attacked by protesters and suffered injuries that led to his hospitalisation.
The Hang Seng spent much of the day above water, but then began a tumble mid-afternoon. It recovered some of its losses, closing down a teensy 0.03 per cent at 26,515.53.
MTR " the owner and operator of the city's subway " closed down 1.4 per cent to HK$46.7. Cathay Pacific, which continues to be caught up in protest fallout as well, lost 3.6 per cent to end at HK$10.3.
Adding even more drama to the city's stock market, Hong Kong Exchanges & Clearing Limited, the operator of Asia's third-largest capital market, suspended trading in the city's derivatives market at 2pm local time, after reporting "connectivity issues" on its trading system.
Its stock closed down 0.3 per cent at HK$247.20, after paring bigger losses on news of the derivatives trading suspension.
It was an eventful day as well on the trade front, with the announcement that China negotiators will go to Washington next month to meet with their US counterparts.
Meanwhile, the Chinese government signalled that it will ease monetary policy by cutting the amount banks are required to hold in cash.
At the State Council's meeting chaired by premier Li Keqiang on Wednesday night, Li said there would in "a timely manner" be both a targeted and broad cut in the reserve requirement ratio for banks, suggesting an imminent lending rate cut.
That boosted investor sentiment in stocks of Chinese companies.
Indices in Shanghai and Shenzhen broke through psychologically important levels in intraday trading.
The Shanghai Composite Index broke through the 3,000 level in the morning, while Shenzhen's tech-heavy ChiNext Index broke through the 1,700 level, heading near a technical bull market as it has rebounded by almost 20 per cent from a recent low in June.
The market gave up some gains in afternoon trading, with the Shanghai Composite Index closing 0.96 per cent higher, at 2,985.9. The Shenzhen Component Index added 0.86 per cent to 9,783.5. The ChiNext Index closed up 1.2 per cent, at 1,689.1.
Brokerage companies, insurers, banks, tech and telecommunication companies were the day's biggest winners.
In other stock moves of note in Hong Kong, property heavyweights led falls.
Wharf Real Estate investment fell by 3.1 per cent to HK$44.9. Henderson Land Properties lost 3.1 per cent to HK$37.5.
Tech stocks outperformed on the trade talks news. AAC Technologies surged 12 per cent to HK$39.1. BYD Electronic rose 8.2 per cent to HK$10.5.
"For the Hang Seng Index, I think the coming one to two weeks will be safe, supported by policy expectation, as the US Fed meeting will be held on September 17 to 18," said Kenny Wen, wealth management strategist at Everbright Sun Hung Kai.
But for the mid term " one to three months " if there is no significant improvement in trade talks and analysts further reduce their corporate earnings forecasts, the Hang Seng may have another round of selling pressure, he said.
"Short term, 26,000 will be the initial support level. And 25,000 will be very key. If its drops below that level, we may have 10 per cent more downside risk," he said.
Kevin Leung, executive director of investment strategy at Haitong International Securities, said Lam's speech did not bring much positive surprise, and the tensions and problems remain. That will continue to disturb the market.
"So it could not build a sustainable rebound (Thursday)," he said. "Many investors are still waiting on the sidelines for clearer signals ... Meanwhile, the collapse of system of the Hong Kong bourse also affected market order," he said.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2019 South China Morning Post Publishers Ltd. All rights reserved.
Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved.