China's Yuan Trades Near 17-Year Low, U.S. New Trade Restrictions Target Chinese Companies

Li Chen
03 Dec, 2024
Hong Kong

Stock market indexes in China and Hong Kong struggled to hold gains of the previous session amid worries of growing trade tensions as the U.S. imposed additional restrictions. 

The Hang Seng index and the mainland-focused CSI 300 index edged up 0.2%, but market sentiment remained weak. 

The Biden administration announced new restrictions on shipments of 24 types of semiconductor equipment and three categories of design and processing software.

The expanded list includes 140 companies, nearly all are China based, including SMIC, Beijing Naura, Piotech, and ACM Research, and Huawei-linked companies. 

Moreover, exporters are bracing for additional sanctions next month from the new U.S. administration that could cover a wider range of products and industries. 

The blitz of fiscal stimulus announced by Chinese policymakers in September has failed to revive consumer sentiment and the property market transactions, as policy measures focused on supporting local government finances. 

The Chinese yuan traded near a 17-year low amid policy easing expectations and rising outflow of funds.

People's Bank of China's governor, Pan Gongsheng, said in a statement that the central bank is prepared to take countercyclical measures to support economic growth and provide ample liquidity to businesses to reduce financing costs. 

 

China Stock Movers 

The Hang Seng index increased 0.2% to 19,567.07, and the mainland-focused CSI 300 index fell 0.4% to 3,930.51. 

Semiconductor-related stocks, electric vehicle makers, and energy stocks were among the most actively traded stocks on Tuesday. 

SMIC fell 1.9% to HK $25.90, GigaDevice fell 1.5% to ¥83.72, and Hygon Information Technology dropped 1.3% to ¥125.37. 

BYD added 0.1% to HK $261.80, Li Auto declined 1.4% to HK $87.55, and Geely Automobile eased 0.3% to HK $14.24, and Xpeng fell 0.1% to HK $48.75. 

CNOOC rose 1.9% to HK $17.40, Sinochem International decreased 0.4% to ¥4.35, and Jilin Chemical gained 1% to ¥3.98. 

China Mobile decreased 0.6% to HK $72.25 after the telecom company made a HK $7.8 billion offer to acquire HKBN.

HKBN jumped 5.5% to HK $5.13.