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Hong Kong stocks retreat after ‘two sessions’ meeting in Beijing sparks concerns about China’s economic growth

  • China’s top legislature, the National People’s Congress (NPC), began its annual meeting in Beijing on Tuesday
  • Premier Li Qiang set a GDP target of around 5 per cent and plans to run a budget deficit of 3 per cent and issue 1 trillion yuan (US$139 billion) of special treasury bonds

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Screens showing the index and stock prices outside Hong Kong Exchange Square (HKEX) in Central. Photo: Sun Yeung
Jiaxing Li
Hong Kong stocks slipped as investors worried about growth challenges in the world’s second largest economy after China’s annual parliamentary meeting unveiled only modest fiscal policy support measures.
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The Hang Seng Index declined 2.6 per cent on Tuesday to close at 16,162.64. It was the biggest retreat since January 17. The Tech Index tumbled 4.3 per cent, while the Shanghai Composite Index added 0.3 per cent. A gauge tracking Chinese stocks listed in New York tumbled 4 per cent overnight.

All but five of the 82 index members saw price declines. Tencent slipped 2.9 per cent to HK$268.20, Alibaba lost 3.3 per cent to HK$69.70 while rival JD.com slid 7.5 per cent to HK$82.75 before its earnings card. Online travel agency Trip.com slid 4.5 per cent to HK$332.60 and food delivery platform Meituan lost 5.6 per cent to HK$86.35.

China’s top legislature, the National People’s Congress (NPC), opened its annual meeting on Tuesday. Premier Li Qiang set a GDP target of around 5 per cent and a consumer price increase target of around 3 per cent.

“We think the ‘around 5%’ GDP growth target will prove very challenging,” according to a note from Nomura analysts which also said “much more stimulus is needed to reach the ambitious growth target”.

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