top of page
Search

Hong Kong stocks experienced a second consecutive day of decline

Hong Kong stocks experienced a second consecutive day of decline, driven by mounting concerns over the prolonged downturn in China's property market, prompting investors to reduce their holdings. The Hang Seng Index fell by 0.6% to 16,527.75 at the midday break, with the Tech Index dropping 0.5%, while the Shanghai Composite Index remained relatively stable.

Hong Kong stocks experienced a second consecutive day of decline

The downturn was exacerbated by the aftermath of an earthquake in the northwestern Chinese province of Gansu, leading to a weakening of several companies based in the region. Country Garden Services saw a substantial decline of 9.8% to HK$6.24 after issuing a profit warning related to asset impairment. Longfor Group, a prominent developer, experienced a 3.8% slump to HK$12.32. Other notable losses included Alibaba Group, down 0.5% to HK$71.75, JD.com sliding 2.3% to HK$103.10, and Meituan sinking by 6.1% to HK$78.10.


Analyst Shen Fanchao from Zheshang International in Hong Kong remarked, "China's economic recovery has yet to gain further traction. In such a scenario, we recommend more diversified stock allocations."


The ongoing crisis in China's real estate market continued to have repercussions, as state-backed developer China South City sought to restructure $1.35 billion of bonds. Mainland funds reportedly sold $1.3 billion of Hong Kong-listed stocks the previous week, according to Goldman Sachs.

The Hang Seng Index has seen a 16% decline this year, putting it on track for an unprecedented four-year slide. The benchmark tracking major stocks in Shanghai and Shenzhen is poised for a record third consecutive year of losses.


Gansu Engineering Consulting and DuZhe Publishing faced setbacks, falling 2.8% and 9.5%, respectively, in response to the 6.2-magnitude earthquake that struck the province overnight, claiming over 110 lives.


COMPANY FORMATION &   DOMICILATION SERVICES

On a brighter note, Nio, the Chinese electric-vehicle maker, saw a 4.7% jump to HK$64.35 after securing a $2.2 billion investment from a fund backed by the Abu Dhabi Investment Authority. This follows a previous investment of $738 million in June and additional share acquisitions by the fund from Tencent.


Smartphone maker Xiaomi experienced a 2.3% gain, reaching HK$16.26, as founder Lei Jun announced the company's readiness to launch its first electric vehicles after substantial investments totaling more than 10 billion yuan.


In Beijing, machine maker Wuxi Lingood Machinery Technology witnessed a remarkable surge of 166%, reaching 14.90 yuan on its first day of trading.


Elsewhere in Asia, the Nikkei 225 rose by 1.2% following the Bank of Japan's decision to maintain its negative interest-rate policy. Australia's S&P/ASX 200 gained 0.9%, while South Korea's Kospi retreated by 0.1%.

By fLEXI tEAM

287 views0 comments
bottom of page