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Hong Kong stocks trade lower on disappointment over China-US trade negotiations

World’s two largest economies stop short of finalising a new deal that would extend a 90-day tariff pause

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People take a selfie in Kowloon. Photo: Edmond So
Zhang Shidongin Shanghai
Concerns about trade tensions between China and the US drove Hong Kong stocks lower by the most in a month and a half, after the world’s two largest economies stopped short of finalising a new deal that would extend a 90-day tariff pause, while HSBC Holdings said its profit dropped.

The Hang Seng Index fell 1.4 per cent to 25,176.93 at the close on Wednesday for the steepest decline since June 19, while the Hang Seng Tech Index slumped 2.7 per cent. On the mainland, the CSI 300 Index was little changed and the Shanghai Composite Index rose 0.2 per cent.

HSBC slumped 3.8 per cent to HK$96.95 after saying its second-quarter profit fell 29 per cent from a year earlier, adding that it expected its bad loan ratio to rise this year. Subsidiary Hang Seng Bank tumbled 7.4 per cent to HK$113.80 after reporting a 30 per cent slump in first-half net income.

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Electric-vehicle makers declined after Morningstar said fierce industry competition would restrain stock prices in the sector. Li Auto slumped 13 per cent to HK$104.50 and BYD sank 5.8 per cent to HK$120.90. Post owner Alibaba Group Holding slid 3 per cent to HK$117.10 and rival JD.com dropped 2.7 per cent to HK$126.90.
China and the US concluded their third round of trade negotiations in Stockholm, with the two sides remaining at odds over the extension of a tariff ceasefire plan. Chinese negotiators said that an extension agreement had been reached, but US Treasury Secretary Scott Bessent said China had “jumped the gun a little” and all terms needed to be approved by President Donald Trump. The existing 90-day truce expires on August 12.
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Investors are also keeping a close eye on the US Federal Reserve’s rate decision and the unfolding earnings season. The Fed is widely expected to keep its benchmark interest rate between 4.25 and 4.5 per cent on Thursday. Some eight companies in the Hang Seng Index are due to release interim reports this week.

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