Hong Kong stocks hit 3-week low on earnings, China economic woes while SenseTime sinks on short-seller report

Local stocks hit the lowest level since November 10 as investors monitor signs on weakening earnings momentum

The BSE 50 index of small-cap stocks in Beijing fell by a record 4.2 per cent slump amid the bourse’s measures to cool rally

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A man takes pictures at the piazza at the Exchange Square in Central, Hong Kong in September 2023. Photo: Elson LI

Zhang Shidongin ShanghaiandJiaxing Liin Hong Kong

Published: 10:36am, 28 Nov 2023Updated: 5:00pm, 28 Nov 2023

Hong Kong stocks fell to near a three-week low on concerns corporate earnings will disappoint investors amid China’s slowdown and property market slump. Reports this week may show Chinese manufacturing contracted again in November. SenseTime slumped on a short-seller attack.

The Hang Seng Index dropped 1 per cent to 17,354.14 on Tuesday, the lowest since November 10. The Tech Index lost 0.8 per cent while the Shanghai Composite Index gained 0.2 per cent. The BSE50 Index of small-cap stocks in Beijing slumped by record 4.2 per cent amid measures to cool recent excessive price gains.

Alibaba Group tumbled 2.3 per cent to HK$74.35 while Meituan retreated 5.2 per cent to HK$103 and Tencent declined 1 per cent to HK$319.60. China’s top lender ICBC dropped 0.5 per cent to HK$3.76 while peer China Merchants Bank lost 3.3 per cent to HK$28.05 on speculation they will be called to lend more to troubled developers.

Weak economic data and worsening property crisis have continued to weigh on sentiment despite Beijing’s attempts to shore up confidence among investors and homebuyers. Beijing’s efforts at injecting small doses of stimulus have so far underwhelmed, forcing global funds to exit from the onshore and Hong Kong markets.

“Investors are waiting for more catalysts with previous ones such as falling US yields and domestic policy [stimulus] running out of steam,” analysts at CICC said in a note on Monday.

Some 31 of 80 Hang Seng Index members have released their September earnings, generating an average 6.5 per cent growth from a year earlier, according to Bloomberg data. Earnings in the first half grew at a 7 per cent pace.