Hang Seng Rally Extends to Third Day, China Service Sector Growth Drops to an 8-month Low

Li Chen
03 Jul, 2024
Hong Kong

Investors battled mixed emotions, and market indexes diverged in Hong Kong and Shanghai. 

Benchmark indexes in Hong Kong gained for the third consecutive day in a row as mainland investors added exposure to dividend-paying stocks. 

Tech stocks led the market gainers after Alibaba said it completed its $5 billion stock repurchase plan in the last quarter. 

Market enthusiasm was capped after the service sector growth rate dropped to an 8-month low. 

The Caixin China service purchasing managers' index eased to 51.2 in June from 54.0 in May, S&P Global reported Wednesday. 

China's services sector is one of the few bright spots in the economy, as the manufacturing sector struggles amid weak domestic demand and the construction sector continues to shrink after weak consumer confidence. 

 

China Stock Movers 

The Hang Seng index increased 1.4% to 17,978.52, and the CSI 300 index decreased 0.3% to 3,466.80. 

Alibaba Group jumped 2.9% to HK $72.50, Meituan added 2.4% to HK $115.50, and Baidu jumped 3.2% to HK $86.55. 

Electric vehicle makers were focused on the expectation that domestic and export sales would continue to advance despite the rising tensions with the US and the European Union. 

On Tuesday, Tesla said it sold 443,956 vehicles in the June quarter, 4.8% lower than a year ago, which helped with incentives and price cuts. 

BYD increased 0.5% to HK $229.40, Li Auto soared 5% to HK $77.55, and Xpeng gained 2% to HK $30.45. 

Three new companies listed their shares on the stock exchanges in Hong Kong and Shanghai. 

Shanghai Ananda Drive Techniques soared to 44.20 yuan after the driving equipment maker priced its initial public offering at 20.56 per share and raised 596 million yuan. 

Zhonggan Communication Group plunged 37% to 79 HK cents, and the company priced its initial public offering price at HK 1.25 per share. 

Xi'an Kingfar Property Services dropped 15% to HK $6.45, and the company priced its initial public offering at HK $7.50 per share and raised HK $125 million.