China Investors Discount Trump Threats of Punitive Tariffs, Stock Indexes Move Higher

Li Chen
26 Nov, 2024
Hong Kong

Stock market indexes in China and Hong Kong advanced as investors looked beyond brewing tariff wars with the U.S. and the European Union. 

The Hang Seng index increased 0.4%, and the CSI 300 index edged higher by 0.35% as investors debated the scope and depth of potential U.S. tariffs on goods shipped from China. 

Investors are taking a wait-and-see approach with the potential increase in U.S. tariffs and diversifying their manufacturing base to minimize the impact. 

Chinese automakers are ramping up production in Thailand, Vietnam, Mexico, and Hungary, as manufacturing companies are shifting more assembly operations to overseas locations. 

The supply chain elongation trend has been in place since 2018, when the U.S. imposed punitive tariffs for the first time, only to see exports from China surge over the next six years. 

China's exports to the U.S. are set to surpass $560 billion in 2024 from $479 billion in 2018, despite rising trade barriers, punitive tariffs, and export controls, according to data available from the U.S. and Chinese government agencies. 

The U.S. tariffs so far have increased operating costs for businesses and living expenses for households and contributed to keeping U.S. inflation at elevated levels. 

 

China Stock Movers 

The Hang Seng index increased 0.4% to 19,244.63, and the mainland China-focused CSI 300 index gained 0.4% to 3,861.81. 

Baidu jumped 5.2% to HK $81.90, and the search company is set to launch trial operations for its autonomous ride-hailing operation in Hong Kong as early as this month. 

Meituan advanced 2.7% to HK $166.40 ahead of the company's quarterly results on Friday. 

Investors are hoping that the online delivery platform operator is likely to report a three-fold surge in its profit. 

CNSIG Anhui Hongsifang Fertilizer soared more than 15-fold to 129.34 yuan on the first day of trading in Shanghai. 

The fertilizer company placed 50 million shares in its initial public offering priced at 7.98 yuan per share.