China and Hong Kong Indexes Halted Multi-Year Slide In 2024 Amid Decelerating Economic Growth

Li Chen
31 Dec, 2024
Hong Kong

Stock market indexes in China closed down, but in Hong Kong were nearly unchanged in thin trading on the final trading day of 2024. 

The Hang Seng index was nearly unchanged, and the CSI 300 index dropped more than 1% amid decelerating economic growth and lack of clarity about the fiscal stimulus implementation plans. 

The Hang Seng index advanced 19.5% in 2024, halting a four-year slide after China's political leaders promised a raft of fiscal stimulus measures to alleviate the debt burden on local governments and support the rebound in property market activities. 

After the initial spurt, market enthusiasm waned in the last three months of trading, as policymakers failed to announce stimulus implementation steps and measures to revive consumer demand. 

Market indexes are likely to face a sharp selloff in the first quarter of 2025 if policymakers show a lack of urgency in implementing fiscal measures and announce new measures to support consumer demand. 

In addition, corporate earnings estimates for 2025 are expected to be downwardly revised as Chinese annual economic growth continues to shift downward over the next five years to 2% from the current 5%. 

On the economic front, China's manufacturing PMI edged lower to 50.1 in December, the National Bureau of Statistics reported Tuesday. 

The official reading on the manufacturing sector expanded for the third consecutive month, confirming uneven economic recovery. 

The non-manufacturing PMI rose to 52.2 in December from 50.0 in November, the statistical bureau said in a separate report today. 

The non-manufacturing sector indicator, which includes the service and the construction sectors, jumped to the highest level since March, confirming the latest flurry of stimulus measures is supporting the latest rebound. 

 

China Stock Movers 

The Hang Seng index was nearly unchanged at 20,059.95, and the CSI 300 index declined 1.6% to 3,934.91. 

China Vanke declined 0.3% to HK $5.29, China Resources Land decreased 0.1% to HK $22.55, and Henderson Land Development Ltd. dropped 0.4% to HK $23.60. 

Li Auto fell 4.3% to HK $93.95, BYD decreased 0.2% to HK $266.60, and Geely Automobile Holding advanced 1.2% to HK $14.82.