China's GDP Growth Maintained 5.4% Pace, Industrial production Surged and Property Market Slump Continued

Li Chen
16 Apr, 2025
Hong Kong

Stock market indexes in China and Hong Kong fell sharply amid escalating trade between the two largest economies, and investors were disappointed after weak property market data. 

The Hang Seng index decreased 2.5%, and the mainland-focused CSI 300 index dropped 1% as the US-China trade war shows no sign of easing. 

Investors reacted positively to GDP growth data, but the weakness in the property market overwhelmed the market sentiment. 

China's GDP in the first quarter increased at an annual pace of 5.4%, surpassing the market expectation of 5.2% and ahead of the government's target of 5%. 

The front-loading by U.S. importers drove the bulk of the rise in economic activities, and the growth rate matched the pace in the December quarter. 

Meanwhile, China's property sector continued to struggle, with prices for new and existing homes declining from the previous month and a year ago amid a lack of demand in 70 mainland cities. 

New home prices across 70 largest mainland cities declined 4.5% in March, easing from 4.8% fall in the previous month, the National Bureau of Statistics reported Wednesday. 

New home prices in Shanghai rose 5.7% compared to 5.6%, but the pace of decline accelerated in Beijing to 5.7% from 5.5%, and slowed in Guangzhou to 7.2% from 7,6% in the previous month, respectively. 

China's industrial production growth accelerated to 7.7% annual pace in March from 5.9% in the January-February period, according to the statistical bureau. 

The industrial production expanded at the fastest pace since June 2021, and activities expanded at an annual pace of 6.5% in the first quarter compared to an increase of 5.8% in the previous quarter.   

Market sentiment weakened as investors priced in slower economic growth, weakening consumer demand, and expectations of earnings revision for the year.

 

China Indexes and Stocks 

The Hang Seng index dropped 2.5% to 20,941.70, and the mainland-focused CSI 300 index decreased 1% to 3,726.17. 

Tech stocks led decliners in Hong Kong, and electric vehicle makers 

Alibaba Group dropped 5% to HK $104.40, Tencent Holdings decreased 3.20% to HK $441.40, and Baidu Inc. fell 2.9% to HK $79.90. 

CK Hutchison Holding decreased 0.3% to HK $41.75, and HSBC Holding rose 0.8% to HK $79.40. 

Kente Catalysts soared 281% to 57.51 yuan on the first day of trading, and the maker of ammonium phosphate products sold 22.6 million shares priced at 15 yuan per share.