Hong Kong stocks slip for fifth day on Longfor, Alibaba losses amid weak China recovery signals while BYD, HSBC advance
- Longfor led losses among developers as a slump in August contracted sales suggests no imminent rebound in China’s housing market
- Sentiment on tech stocks weakened as Alibaba slid amid a management reshuffle while JD.com hit a new all-time low
The Hang Seng Index dropped 0.4 per cent to 18,025.89 at the close of Tuesday trading, capping a five-day, 4.3 per cent loss. The Tech Index declined 0.5 per cent while the Shanghai Composite Index retreated 0.2 per cent.
Longfor Group fell 2.2 per cent to HK$16.40 after contracted sales in August slumped 41 per cent from a year earlier, signalling no imminent turnaround in China’s housing market. Peer China Overseas Land and Investment shed 1.1 per cent to HK$16.54. Alibaba Group dropped 2 per cent to HK$86.30 and JD.com slipped 0.7 per cent to an all-time low of HK$124.70.
Limiting losses, BYD climbed 2.8 per cent to HK$254.80 and Xpeng added 1.5 per cent to HK$72.80, after sales of electric cars in China rose 27 per cent from a year ago in August. HSBC gained 0.5 per cent to HK$57.95 on speculation the lender has raised mortgage rates to overcome costlier interbank funds in Hong Kong.
“Markets should avoid jumping to conclusions [about a turnaround in the economy], because data can be easily distorted by base effects, seasonality, unsustainable pent-up demand or simply data quality issues,” said Lu Ting, chief China economist at Nomura The economy has yet to stabilise, and Beijing may need to introduce more aggressive easing measures, he said.
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Government reports later this week may show industrial production rose 3.9 per cent from a year earlier, versus a 3.7 per cent gain in July, according to economists tracked by Bloomberg. Retail sales probably grew 3 per cent from 2.5 per cent for the same period.