Hong Kong stocks slide for seventh day as strategists cut targets on growth outlook while Taiwan tensions sap appetite
Hong Kong stocks fell for a seventh day as strategists at Citigroup and HSBC lowered their upside targets amid worries about interest rates and China’s weak economic recovery. China cranked up cross-strait tensions ahead of a presidential election in Taiwan.
The Hang Seng Index declined 0.4 per cent to 16,123.95 at 9.45am local time, adding to the 5 per cent loss in the preceding six days. A seven-day slide would be the longest streak since mid-August. The Tech Index dropped 0.5 per cent to a 13-month low, while the Shanghai Composite Index retreated 0.7 per cent.
Tencent fell 0.5 per cent to HK$282.20, Meituan weakened 0.6 per cent to HK$70.15 and Trip.com slid 1.4 per cent to HK$292.40, leading tech stock losses. HSBC declined 0.9 per cent to HK$62.90, Sands China dropped 1.5 per cent to HK$22.25 and casino peer Galaxy Entertainment tumbled 1 per cent to HK$40.65.
“Stock performance appears to be increasingly detached from economic reality and earnings fundamentals,” Yan Wang, chief China strategist at Alpine Macro, said in a report on Tuesday. “The poor equity market reflects investors’ extremely weak confidence and Beijing’s badly damaged policy credibility, both of which are not easy to fix.”
Citigroup, HSBC trim Hang Seng Index targets on earnings, China policy doubts
Citigroup, HSBC trim Hang Seng Index targets on earnings, China policy doubts
The Hang Seng Index has lost 5.4 per cent so far this year, the worst start to a year in about two decades, China’s economic weakness persisted and Beijing’s policy response underwhelmed. Citigroup and HSBC trimmed their upside forecasts for the Hang Seng Index amid questions over corporate earnings.
Meanwhile, cross-strait tensions heightened as Taiwanese vote for a new president later this week. Xie Feng, Chinese ambassador in Washington, on Tuesday said Beijing “simply has no room for compromise” with those championing Taiwan independence, as the island picks a new president on Saturday.
Elsewhere, Shanghai Bloom Technology surged 25 per cent to 90.32 yuan on the first day of trading in Shanghai.
Other key Asian markets were mixed. South Korea’s Kospi fell 0.5 per cent and Australia’s S&P/ASX 200 weakened 0.4 per cent, while Japan’s Nikkei 225 advanced 1.6 per cent.
