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China stocks slip, typhoon knocks out Hong Kong trading as GDP report pressures Beijing to stimulus economy

  • Trading in Hong Kong was suspended after the first T8 warning signal of the year after Typhoon Talim approached the city on early Monday
  • China’s second-quarter GDP growth trailed market consensus with record joblessness among the nation’s youth, official report showed

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Dark clouds gather over Victoria Harbour as Talim approaches the city. Photo: Yik Yeung-man
Jiaxing Li
Stocks in mainland China declined after an official report showed the economy grew last quarter at a pace below market consensus, while unemployment among the nation’s youth hit a new high. Trading in Hong Kong was cancelled on typhoon warning.
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The Shanghai Composite Index dropped 0.9 per cent to 3,209.63 at the close of Monday trading, surrendering most of last week’s 1.3 per cent advance. The CSI 300 Index fell 0.8 per cent.

Longi Green Energy Technology weakened 0.8 per cent to 29.79 yuan, while Kweichow Moutai retreated 1.3 per cent to 1729.97 yuan. Foxconn Industrial slumped 4.2 per cent to 26.11 yuan, Will Semiconductor tumbled 4 per cent to 102.28 yuan and Cambricon Technologies dropped 2.8 per cent to 200.20 yuan.

A man rides on an electric bike past residential buildings in Beijing in June 2023. China’s consumer and factory activity weakened in May and June. Photo: AP
A man rides on an electric bike past residential buildings in Beijing in June 2023. China’s consumer and factory activity weakened in May and June. Photo: AP
China’s economy grew at an annual pace of 6.3 per cent in the second quarter, versus 4.5 per cent in the first three months of 2023, the government said on Monday. The pace was slower than the 7.1 per cent consensus by economists, with recent data showing a slide in manufacturing. The jobless rate for people in the 16-24 age group increased to 21.3 per cent in June, from 20.8 per cent in May.

There is “little in the way of joy” for those hoping for a swift Chinese recovery story, said Tim Waterer, chief market analyst at KCM Trade. Investors will monitor what Beijing will do to address concerns about the faltering economy, he added.

“Most onshore investors see low probability for large-scaled or unorthodox stimulus as the government’s growth target of ‘around 5 per cent’ is still within reach,” Kinger Lau, China equity strategist at Goldman Sachs wrote in a note on Monday. Policy visibility will improve after the Politburo meeting later this month, he added.

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