As Chinese banks and oil companies dropped, Hong Kong's benchmark Hang Seng Index went below the psychologically important 14,000 point on Monday.

The blue-chip Hang Seng Index fell 406.44 points, or 2.83 percent, to 13,971 after fluctuating between 13,895.04 and 14,312.26 during the session. This is the index's lowest closing level since Dec. 5, when it ended at 13,846.

Turnover totaled 46.26 billion HK dollars (5.93 billion U.S. dollars), up from Friday's 45.14 billion HK dollars (5.82 billion U.S. dollars).

According to traders, losses of the benchmark index will likely be extended, and could dropped to 12,000 in the first quarter as corporate earnings and economic data will probably remain weak, which will weigh on investors.

"Sentiment remains bearish and sell offs are likely to continue in the near term," ICEA Securities strategist Ernie Hon said.

Chinese banks declined over the past five sessions exceeded the index's 10.2 percent fall since Tuesday, as foreign major shareholders' sale of stakes in Chinese banks last week put concerns about further stake sales, which pressured prices.

Industrial and Commercial Bank of China fell 5.2 percent to end at 3.46 HK dollars, or down 20.3 percent since Tuesday. Bank of China was down 6.1 percent at 1.84 HK dollars, and has lost 16.7 percent over the last five sessions.

China Construction Bank went down 4.9 percent to 3.73 HK dollars, losing 19.8 percent since Tuesday. Oil stocks tumbled, after crude oil futures fell more than 2 percent to below 40 US dollars a barrel Monday in Asia as buyers still disinclined to step in amid the ongoing economic downturn.

PetroChina, the second-biggest heavyweight of the blue chip index, declined 4.8 percent to 6.68 HK dollars, while Cnooc sank 4.7 percent at 7.10 dollars.

Sinopec, which focuses on refining, also down 4.4 percent to 4.52 HK dollars.

Investment manager Jackson Wong at Tanrich Securities said that in general, the local bourse is waiting for a good excuse for a technical rebound after its latest declines. However, the market still lacks strong positive leads.

Source:Xinhua