Hong Kong stocks retreat after downbeat China data, Trump rally shooting
Hong Kong stocks fell during trade on Monday as risk appetite soured after weaker than expected Chinese economic data added to investor woes after the mood was already jittery following the assassination attempt on former US President Donald Trump at a political rally. The retreat comes at a time when investors are reining in expectations from China's third plenum which kicked off today.
The Hang Seng Index slipped 1.6 per cent to 18,009.95 at the close of trade on Monday. The Hang Seng Tech Index declined 2.9 per cent, while the Shanghai Composite Index added 0.1 per cent.
A slew of Chinese economic data released on Monday showed the world's second largest economy was still struggling to boost domestic demand. The second quarter GDP figures, which showed growth of 4.7 per cent year-on-year in April-June, lagged market expectations of 5.1 per cent. It was a slowdown from 5.3 per cent in the previous three months and the weakest growth since the third quarter of 2023.
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Retail sales in June grew 2 per cent year on year, which was also well below market expectations of 3.4 per cent.
"The growth figures for China is a dent for risk appetite," said Tim Waterer, chief market analyst at KCM Trade. "Retail Sales reflected the still patchy domestic demand picture in China. Industrial Production was one of the few bright spots in the data today. All up - China's economy is still struggling for traction."
Baidu led losses falling 5.6 per cent to HK$93.95, Alibaba fell 2.2 per cent to HK$76.65 and Tencent dropped 1.7 per cent to HK$390.20. JD.com declined 4.7 per cent to HK106.70, sportswear brand Li Ning fell 4.9 per cent to HK$15.42, while Chow Tai Fook retreated 4.5 per cent to HK$8.25.
Meanwhile, investors braced for the implications of the attempted assassination of former US President Trump over the weekend. The event has boosted the odds of his second presidency to 70 per cent from 60 per cent, according to the public poll.
"The direct impact could be a firmer US dollar, as higher odds of a Trump's presidency suggest that his inflationary policies in terms of stricter immigration, tougher trade ties and increased spending could potentially be set to pass," said Yeap Jun Rong, Market Analyst at IG Group.
Traders will closely monitor China's third plenum of the 20th Party Congress, the long anticipated meeting where the country's leaders gather and are expected to release reforms to tackle the economic headwinds facing the nation.
In its trading debut in Hong Kong today, vehicle hardware maker GL-Carlink Technology Holding shares gained 0.1 per cent from its IPO price to HK$4.79.
Other major Asian markets rose. Australia's S&P/ASX 200 added 0.7 per cent and South Korea's Kospi added 0.1 per cent. Japan's markets are shut for a public holiday.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.
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