Hong Kong stocks continue slide as more disappointing economic data, property crisis weigh on sentiment
- Most members of the Hang Seng Index decline after data on China’s credit growth and loans fall short of expectations
- Official reports on industrial output, retail sales and fixed-assets investment, due on Tuesday, are also likely to show China’s economy struggling
The Hang Seng Index dropped 1.6 per cent to 18,773.55 at the close of Monday trading, near a three-week low. The tech index slipped 1.5 per cent while the Shanghai Composite Index declined 0.3 per cent.
Almost all 80 index members declined. Alibaba Group lost 2.6 per cent to HK$92.80, rival JD.com tumbled 1.3 per cent to HK$144.20 and Tencent Holdings declined 0.8 per cent to HK$333.20. EV maker BYD tumbled 6.2 per cent to HK$238.60, while Macau casino operator Sands China slid 1.4 per cent to HK$28.20.
China’s credit growth in July came in well below market expectations, with new aggregate financing standing at 528 billion yuan (US$72.8 billion), less than half of consensus expectations. Meanwhile, loans to the real economy plummeted to 36.4 billion yuan, the lowest since 2006, according to Goldman Sachs.
“In addition to lacklustre economic data, a long-simmering threat to economic and financial stability, the intersection of weak property market prices and a mountain of debt in the sector is causing considerable concern,” analysts at DBS Group Research wrote in a note on Sunday. Decisive, targeted measures to restructure the property sector are much needed for sentiments to bottom, they added.