China Indexes Extend Weekly Losses Amid Global Sell-off

Li Chen
02 Aug, 2024
Hong Kong

Stocks in Shanghai and Hong Kong dropped sharply and extended losses to the third week in a row amid a global market sell-off.

The Hang Seng index declined more than 2% and the CSI 300 index dropped nearly 1% after the U.S. economy data raised concerns about the health of the U.S. economy. 

The two widely held indexes nearly wiped out this year's gains as investors shift focus to the recession and turn risk-averse amid rising geopolitical uncertainty. 

Factory activities contracted for the third month in a row in July, and weekly initial jobless claims approached a one-year high at the end of the last week, the latest U.S. economic data suggested. 

Market indexes were also under pressure after Hong Kong Land reported a sharp jump in losses in its first half, stoking fears of a protracted property market slump. 

Investors stayed on the sidelines for the third week in a row amid persistent China deflation worries, a rising tide of capital outflows, and Beijing's reluctance to stimulate the economy amid faltering consumer confidence. 

 

China Stock Movers 

The Hang Seng index declined 2.3% to 16,915.69, and the CSI 300 index dropped 0.9% to 3,387.10.

Hong Kong Land Holdings decreased 1.3% to HK$3.20 after the residential property developer reported a net loss in the first half that jumped 150% amid a protracted property downturn in Hong Kong and the mainland. 

Net loss expanded to US$833 million from US$333 million, reflecting a non-cash property valuation adjustment. 

The underlying loss was US$7 million, excluding the non-cash provision of US$295 million for property development projects in mainland China, compared to US$288 million. 

The company plans to pay an interim dividend of US$6 per share, matching the payout in the previous year. 

China Vanke declined 1.5% to HK $4.05, China Resources Land decreased 2% to HK $22.20, and Henderson Land Development was unchanged at HK $21.90.