China Indexes Fall 1% Amid Fiscal Measures Uncertainty and Weak Earnings Growth Outlook

Li Chen
30 Oct, 2024
Hong Kong

Stock market indexes in China and Hong Kong turned lower ahead of a key legislative meeting that could pave the way for a large fiscal stimulus package.

The Hang Seng index dropped nearly 2% and the CSI 300 index fell more than 1% ahead of the National People's Congress Standing Committee meeting next week. 

Investors have priced in expectations of at least 2 trillion yuan in additional government spending to revive the housing market after four years of malaise. 

Stock market indexes in China are likely to tread water in the near term amid earnings-season uncertainty, and rising trade tensions with the European Union are adding to market anxiety. 

Moreover, the U.S. presidential election is also raising tensions, as both leading candidates have pledged to impose punitive tariffs on Chinese goods shipped from China, Mexico, Malaysia, and Vietnam. 

 

China Stock Movers 

The Hang Seng index dropped 1.8% to 20,337.01, and the mainland-focused CSI 300 index declined 1.4% to 3,870.12. 

China Merchants Bank declined 3.8% to HK $37.85, and the largest retail bank said net income in the first nine months in 2024 increased 0.6%. 

Haier Smart Home declined 2.9% to HK $28.95 after the home appliance maker reported weaker-than-expected profit in the third quarter. 

WH Group Ltd. rose 1.0% to HK $6.34 after the pork processor reported net income surged 97% in the nine months to September in 2024. 

Electric vehicle makers traded down after the European Union imposed tariffs between 18% and 20% on Chinese vehicles shipped to the region. 

Geely Automobile declined 2.7% to HK $14.46, Li Auto fell 3% to HK $108.10, and BYD fell 0.5% to HK $295.40. 

Jiangsu Lopal Tech dropped 7% to HK $5.01 after the new energy material company priced its initial public offering and listed its share on the Hong Kong Stock Exchange. 

The company priced its offering of 100 million shares at HK $5.50 per share and raised HK $495 million. 

The international tranche of 90 million shares was oversubscribed 3.2 times, and the domestic tranche of 10 million shares received applications for nearly 4 times the offered shares.