All Things Newz

China shares drop, HK stocks hit lowest since financial crisis


Article content

SHANGHAI — China shares fell on Thursday morning, while Hong Kong stocks hit levels last seen during the 2008-09 global financial crisis, as overnight Wall Street losses and a resumed slide in the yuan dented fragile investor confidence.

** Hong Kong benchmark Hang Seng slumped 2.4% by the lunch break, to 16,110.98 points, the lowest level since May, 2009. The Hang Seng Tech Index dropped 3.4%, after Nasdaq-listed China stocks tumbled 7.1% overnight.

Article content

** China stocks fared better, amid signs of government-orchestrated efforts to stabilize markets during the ongoing Communist Party Congress.

Advertisement 2

Article content

** The blue-chip CSI300 Index declined 0.7%, while the Shanghai Composite Index lost 0.4%.

** Confidence in China assets were shaken after the yuan resumed its slide against the dollar, as the U.S.-China yield spread widens further. Offshore yuan hit a record low of 7.2794 per dollar on Thursday, before recovering some losses.

** Yuan Yuwei, a hedge fund manager at Water Wisdom Asset Management, said yuan depreciation adds woes to the Hong Kong stock market, where dominating sectors including banking, property and Internet are all in decline amid President Xi Jinping’s “Common Prosperity” drive.

** “You cannot rule out a technical rebound at this level. But you don’t expect a reversal of trend” unless global central banks start pumping liquidity again, he said.

Advertisement 3

Article content

** The market weakness also reflects disillusionment toward Hong Kong Chief Executive John Lee’s first policy address made on Wednesday. In that speech, Lee prioritized improving competitiveness and attracting more overseas talent, but also stressed the need to bolster national security in the Chinese-ruled city.

** An index tracking Hong Kong-listed mainland property developers dropped 1.4%. Moody’s published a report saying China’s property sales will fall on weak demand while funding conditions will remain tight.

** Fosun International lost 0.4%, erasing earlier gains, even after it announced a deal that will likely ease its liquidity stress.

** In China, most sectors fell, but defense stocks are firm. (Reporting by Shanghai Newsroom; editing by Uttaresh.V)



Postmedia is committed to maintaining a lively but civil forum for discussion and encourage all readers to share their views on our articles. Comments may take up to an hour for moderation before appearing on the site. We ask you to keep your comments relevant and respectful. We have enabled email notifications—you will now receive an email if you receive a reply to your comment, there is an update to a comment thread you follow or if a user you follow comments. Visit our Community Guidelines for more information and details on how to adjust your email settings.


Source link

Related posts

Warren Buffett Cuts Stake in China’s BYD, Spurring Bets More May Come

Competition Bureau witness faces grilling at Rogers-Shaw tribunal

Oil prices firm on China demand optimism