HK stocks slip as tech muddles sovereign debt picture

Asian shares declined on Thursday as concerns about sovereign bond markets were heightened by reports that major technology firms were looking to borrow billions, all vying for scarce liquidity. In Hong Kong, the Hang Seng Index started the day down 98 points, or 0.41 percent, at 24,031. The tech sector index fell 10 points, or 0.25 percent, to 4,183, while the China Enterprises Index slipped 18 points, or 0.23 percent, to 8,063.

On the Chinese mainland, the Shanghai Composite Index opened 3 points, or 0.08 percent, lower at 3,838. The Shenzhen Component Index gained 8 points, or 0.07 percent, to 12,896, while the ChiNext Index rose by 5 points, or 0.17 percent, to 3,140. Chinese markets opened mixed as oil prices surged, adding pressure to US Treasuries despite a successful auction of the nation's 10-year debt overnight, which helped keep yields from hitting a 24-year high.

Rising borrowing costs put other regional equities under defensive pressure. Tokyo's Nikkei Index began the day down 195 points, or 0.28 percent, at 69,840. Seoul's Kospi Index opened slightly higher before slipping during mid-morning trading. Samsung Electronics forecast a staggering 783 percent increase in third-quarter operating profit to US$80.17 billion, but its shares slipped 0.3 percent.

Minutes released on Wednesday from the Federal Reserve's previous meeting indicated most members believed another rate hike was probable by year-end, with discussions remaining open until their next gathering. Markets currently estimate a 19 percent probability the Fed will raise rates again this month, yet 80 percent price a hike for December.

Analysts at Goldman Sachs expect a second Fed hike in December, though they believe the central bank may ultimately decide that additional tightening is not required.