HONG KONG, Oct. 16 (Xinhua) -- Hong Kong stocks set a new record of 29,920.25 on Tuesday morning but closed 1.98 percent lower due to heavy profit-taking pressure.

    The benchmark Hang Seng Index fell 586.23 points, or 2 percent, to 28,954.55 after trading between 28,884.23 and 29,920.25 during the session.

    H-share index, which reflected the performance of state-owned companies registered in the Chinese mainland, dropped 1.58 percent to 19,441.33 after set a record for the second day running at 20226.96 shortly after the stocks opened.

    Turnover surged to 200.83 billion HK dollars (25.91 billion U.S. dollars) from Monday's 174.46 billion HK dollars (22.53 billion U. S. dollars).

    Experts said news that China's highly anticipated individual overseas investment scheme may not be implemented soon also weighed on Hong Kong shares.

    Shares of China's three biggest oil companies fell on heavy profit-taking after their record closes Monday. Cnooc fell 4.2 percent to 14.24 Hong Kong dollars, while Sinopec dropped 5.6 percent to 12.24 Hong Kong dollars.

    PetroChina, which became the world's second largest stock in market capitalization on Monday, soared to a record high of 19.82 Hong Kong dollars but ended 2.1 percent lower at 18.38 Hong Kong dollars.

    Chinese financial stocks also fell. Industrial and Commercial Bank of China, the country's biggest bank by assets, dropped 1.5 percent to 6.62 Hong Kong dollars, and China Construction Bank fell 2 percent to 7.20 Hong Kong dollars.

    Trading company Li and Fung retreated 2.1 percent to 33.00 Hong Kong dollars after Nomura Securities Ltd., an international brokerage firm, downgraded it to "hold" from "buy" with a price target of 36.00 Hong Kong dollars.

    The brokerage said recent earnings forecast downgrades by U.S. retailers have further raised uncertainties about the outlook for the U.S. economy. Despite the broad market decline, heavyweight China Mobile closed at a record after ABN Amro, one of the largest banks in Europe, set a target price for the stock of 200 Hong Kong dollars. The mobile operator rose 1.2 percent to 143.30 Hong Kong dollars.