Hong Kong stocks fell on Thursday as persistent concerns about the real estate sector weighed on investor sentiment. The Hang Seng Index closed lower, reflecting the market’s sensitivity to developments in the property market.

Several factors contributed to the negative outlook. Rising interest rates have increased borrowing costs for developers and potential homebuyers, potentially dampening demand. Additionally, government measures aimed at cooling the property market, such as increased stamp duties, have further impacted transaction volumes.

Analysts suggest that investors are also concerned about the potential for a correction in property valuations. After years of strong growth, there are fears that prices may have reached unsustainable levels. A significant price decline could have a ripple effect on the broader economy, impacting banks and other related industries.

The performance of major property developers listed on the Hong Kong stock exchange reflected these concerns. Shares of several leading developers experienced notable declines, contributing to the overall market downturn.

While some investors remain optimistic about the long-term prospects of the Hong Kong property market, the current environment is characterized by uncertainty and caution. Market participants will be closely monitoring economic data and government policies for further clues about the future direction of the real estate sector.