China, Hong Kong stocks slide after president’s milestone speech leaves out stimulus for kick-starting a slowing economy
- Xi did not give clear signals about direction of future economic reform at a time when the Chinese government’s commitment to market liberalisation is seen to have waned
Equity prices slid in Hong Kong and mainland China, following an overnight bloodbath in the US markets and a keynote speech Tuesday by Chinese President Xi Jinping that failed to provide a much-anticipated stimulus to kick-start the sagging economy.
The Shanghai Composite Index, which started Tuesday’s trading with single point gain, closed 0.8 per cent lower at 2,576.65 in Shanghai. The Shenzhen Composite Index closed 0.8 per cent down at 1,312.55. The Hang Seng Index closed down 1 per cent, ending at 25,814.25.
Xi, in a speech marking the 40th anniversary of China’s economic reforms, provided a glowing report card of how China’s growth rate had tripled the rest of the world’s average pace since 1978, and how the nation’s contribution to the global economy had increased eightfold.
But he pointedly refrained from announcing any new policy initiatives, unveiling any financial stimulus to boost the economy’s sagging growth, or providing a clear path out of the nation’s trade war with the United States.
In January, vice-premier Liu He told the 48th World Economic Forum in Davos that China would launch new and stronger reform measures at the 40th anniversary of reform and opening up, saying “some of our measures will exceed expectations of international community.”