Hong Kong stocks notch modest gains, while Shanghai gives up ground as investors stay cautious amid big data week ahead

Shanghai and Hong Kong stocks traded mixed on Friday, closing out a volatile week of trading, as investors avoided assets perceived as risky.

Investors were also taking to the sidelines ahead of a batch of domestic economic data due out next week, including figures for China’s consumer prices in March and the pace of economic growth in the first quarter.

The Shanghai Composite Index retreated for a third straight session on Friday, easing 0.78 per cent, or 23.46 points at 2,984.96. For the week the index gave up 0.8 per cent.

The Hang Seng Index rose 0.5 per cent during Friday’s session to close at 20,370.40. For the week, the index was up 0.72 per cent. The Hang Seng China Enterprises Index rose 0.66 per cent or 57.48 points to 8,704.81.

“The biggest worry [in the A-share market] is still economic growth. Recent [PMI] data has delivered a positive signal but investors’ confidence is not strong yet,” First Seafront Fund Executive Director Yang Delong said.

The Shanghai Composite Index has been trading around the 3,000-point level for two weeks as investors await fresh catalysts such as the introduction of the Shenzhen Hong Kong Stock Connect, Yang added.

China is to release new loan growth figures for March on Sunday, monthly consumer price figures on Monday, international trade flow data on Wednesday and first quarter GDP growth figures on Friday.

Market watchers expect the consumer prices in March to grow 2.5 per cent on year, compared with 2.3 per cent rise in February. GDP growth in the first quarter is expected to print at 6.7 per cent.

Among concerns, rising inflation may force the government to tighten its monetary policy, Haitong Securities Xun Yugen said in a latest report.

In other trading on Friday, the CSI 300, which tracks the large companies listed in Shanghai and Shenzhen, was down 0.73 per cent or 23.56 points to 3,185.73.

The Shenzhen Composite Index declined 0.83 per cent to 1,914.32 while the Nasdaq-style ChiNext dropped 0.83 per cent to 2,229.93.

Among gainers in Hong Kong, HSBC Holdings inched up 0.44 per cent to HK$46, while

Lenovo Group rose 2.96 per cent to HK$5.92. China Mobile shares rose 0.12 per cent to HK$86.35 and CNOOC rose 1.94 per cent to HK$8.95. Tencent Holdings fell 1.11 per cent to HK$160.

Swire Pacific’s class A shares gained 1 per cent, even as Swire Properties announced it would cut prices new apartments on offer in West Mid-Levels Hong Kong by about 20 per cent prevailing market prices.

Meanwhile, in China turnover in Shanghai and Shenzhen shrank to 584.6 billion yuan (HK$700.32 billion).

Brokerages, banking and energy companies traded weaker, while gold miners bucked the downtrend. Chifeng Jilong Gold jumped its daily limit 10 per cent to close at 18.90 yuan while Shandong Gold Group rose 9.61 per cent.

Among other action in Hong Kong,

Wharf Holdings shares outperformed to end 3.02 per cent higher at HK$40.95.

Hengan International Group, China’s largest manufacturer of sanitary napkins and baby diapers, ranked as the worst-performing blue chip as its shares fell 1.73 per cent to HK$68.25.

Sinoref Holdings shares plunged 29.49 per cent to HK$0.21 in resumed trade Friday, hitting the lowest level since July 6 last year. Major shareholder China Zhongjin Group was under investigation by Shanghai authorities for a suspected Ponzi scheme that absorbed over 30 billion yuan through its peer-to-peer platform.

Linus Yip, chief strategist at First Shanghai Securities based in Hong Kong, said the strong Japanese yen has undermined investor confidence in the ability of the Bank of Japan to boost economic growth.

“I expect the Bank of Japan will introduce some new measures on monetary policy, but do not expect much weakness in the Japanese yen as the ‘best time’ [for new measures] has already passed,” said Yip.

Additional reporting by Celia Chen.

Three major US indices closed lower on Thursday. The Dow Jones industrial average fell 174.05 points, or 0.98 per cent, to 17,542.96, the S&P 500 lost 24.75 points, or 1.2 per cent, to 2,041.91 and the Nasdaq Composite dropped 72.35 points, or 1.47 per cent, to 4,848.37.

In Asian trading on Friday morning, Tokyo’s Nikkei 225 lost 0.3 per cent to 15,702.75 while Australia’s benchmark index dropped 0.63 per cent.

Almost all Hong Kong-listed companies with American Depository Receipts (ADRs) traded in the US saw them close lower than their equivalent Hong Kong closing prices on Thursday after conversion into the local currency.

HSBC’s ADR closed 0.57 per cent lower at HK$45.54 from the HK$45.8 seen at the Hong Kong close. Sinopec dropped 1.49 per cent to HK$4.91 from HK$4.99 at the Hong Kong close. CNOOC’s ADR declined 1.13 per cent, sliding from HK$8.78 to HK$8.68.