Hong Kong stocks snapped a four-day winning streak on Wednesday as many investors cashed in their previous gains amid concern there might be deeper corrections in the days to come.
The benchmark Hang Seng Index fell 218.77 points, or 1.04 percent, to close at 20,851.04 after trading between 20,825.16 and 21,085.09.
Turnover also shrank considerably to 62.59 billion HK dollars (8.08 billion U. S. dollars) from Tuesday's 71.08 billion HK dollars (9.18 billion U.S. dollars).
The Hang Seng Index has rallied 84 percent since hitting a four- month low on March 9. Stocks on the gauge are valued at 17.1 times estimated earnings, up from 10.6 at the start of the year.
As the top stock by turnover on the day, heavyweight China Mobile retreated 1.44 percent to 78.45 HK dollars. The sole market operator HK Exchange dipped 1.37 percent to 144.5 HK dollars while HSBC, which accounts for the biggest weighting of the Hang Seng Index, dropped by 1.71 percent to 83.3 HK dollars.
Among the top 20 shares by turnover, Alibaba, China's leading B2B e-business company, saw the largest drop of 6.7 percent to 20.2 after its chairman sold part of his stake. It was followed by PCmaker Lenovo, which plunged 5.74 percent after a sales document showed TPG Inc., General Atlantic and Newbridge Asia are selling shares in the company.
Hong Kong-list Chinese companies as a whole under performed the overall market, as the Hang Seng China Enterprises Index, which tracks so-called H shares of Chinese companies, fell 1.3 percent.
If not for the robust performance of dairy company Mengniu, which surged 6.78 percent, the fall could be further, market observers said.
The country's largest private car-maker Geely also contributed to preventing the index from falling further into the negative by rising 1.5 percent, after news that Chinese passenger-car sales surged a record 90 percent last month.