China, Hong Kong stocks slip as trade war continues to weigh on investor sentiment
- Gains in autos cap losses in Shanghai, raise hopes for more consumption stimulus measures
- Hang Seng Index extends losses into third consecutive session
China stocks lost ground Wednesday, weighed down by banks and insurers, while Hong Kong’s main benchmark extended its losses to a third day, pushed lower by social media giant Tencent and health care shares.
The Shanghai Composite Index lost 0.3 per cent, finishing at 2,893.76. The CSI 300 index, which tracks blue chips listed in Shenzhen and Shanghai, lost 0.4 per cent, closing at 3,802.58.
Chinese auto companies rallied, after Beijing told local governments to take steps to help the struggling auto industry. Investors continue to bet Beijing will offer more stimulus measures to boost consumption amid the ongoing trade war with the US.
Meanwhile, the Hang Seng Index closed down by 0.2 per cent, at 25,615.48.
“Investors are seeking out leading consumer names that either have shown steady earnings or are leading brands in their respective consumer sector to put their money in,” said Alex Wong, a director at Ample Finance Group. “They are switching out from banks and financial stocks, as their growth will likely be impaired under the current concerns of the global economy slowing down.”
Hong Kong secretary for commerce and economic development Edward Yau said the city’s GDP in the third and fourth quarter could face pressure after a new wave of tariffs that US tariffs imposed on China goods, taking effective September and October 1. Ongoing protests, which show no signs of ending, have also weighed on Hong Kong shares.
Tencent closed down 2.2 per cent at HK$319.
CSPC Pharmaceutical fell 4.9 per cent to HK$15.5, after posting gains for nine straight sessions. Sino Biopharmaceutical, a Hong Kong-based drug maker, closed down 3.45 per cent at HK$10.62, after posting gains for the previous eight straight sessions.
Huaneng Renewables closed up 3.9 per cent at HK$2.16. The renewable energy unit of the nation’s largest power producer China Huaneng Group reported a 31.7 per cent jump in net profit to 3.1 billion yuan for the year’s first six months.
Shares of Chinese conglomerate Fosun International climbed by as much as 5.8 per cent in morning trading, after the company reported record first-half revenue and its first interim dividend arrangement. It finished up about 4 per cent at HK$9.95.
China Southern Airlines, mainland China’s largest air carrier, reported a 20.9 per cent profit drop for the first half of this year amid a weaker Chinese yuan and volatile global oil prices.
Its Hong Kong-listed shares closed down 3.5 per cent to HK$4.41, while its mainland-listed shares finished lower by 2.8 per cent at 6.63 yuan.
Meanwhile, in Shanghai, Industrial Bank closed down 4.9 per cent at 17.37 yuan.
Insurers also dropped, with Ping An Insurance down 0.9 per cent at 86.9 yuan and China Life Insurance falling 1.8 per cent to 29.02 yuan.
Liquor distiller giant Kweichow Moutai lost 0.8 per cent to close at 1,100.11 yuan.
But Wuliangye Yibin, the smaller fiery liquor distiller rival, rose to a record in Shenzhen trading, closing up 1.2 per cent at 133.92 yuan, after Citic Securities raised the price target of the stock by 25 per cent to 156 yuan.
Several auto stocks hit the daily 10 per cent up limit. They included Lifan Industry, finishing at 4.33 yuan, Hualing Xingma Automobile, closing at 5.46 yuan, and Shenyang Jinbei Automotive, which ended at 4.25 yuan.
Great Wall Motor rose 2.3 per cent to close at 8.55 yuan.
