Hong Kong shares dropped nearly 500 points on Wednesday, the biggest single-day loss since late November, as a global downturn triggered wide sell-off in the market.

The benchmark Hang Seng Index lost 2.5 percent to 19,651.51, the fourth losing day in a row. The daily turnover reached an all-time high of HK$80.5 billion.

"The market seems to have entered into a consolidation period. It simply lost momentum," said Casor Pang, strategist at Sun Hung Kai Financial Group.

Institutional investors that jumped in over the past few weeks faced the largest sell-off pressure.

Shares in mainland financial services firms, led by top life insurer China Life Insurance Co and top lender the Industrial and Commercial Bank of China, fell more than 5 percent yesterday.

External factors were balmed for the recent decline.

Wall Street's 400-point drop on Tuesday was apparently the most obvious factor, said Tung Sing-hing at Tung Tai Securities.

The worst daily loss in mainland shares in a decade on Tuesday also dealt a blow to Hong Kong shares.

The China Enterprises Index of H shares, or Hong Kong-listed shares in mainland companies, tumbled 3.2 per cent to end at 9,283.67, its lowest close since December 19.

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