China's Quarterly Economic Growth Slipped and Property Investment Plunged

Li Chen
19 Jan, 2026
Hong Kong

Stocks faced headwinds in China and Hong Kong as investors reviewed a fresh batch of official economic releases. 

The Hang Seng Index decreased 1%, and the mainland-focused CSI 300 index eased 0.2% amid slowing economic growth, persistent decline in home prices, and weakening retail sales. 

China's GDP growth slowed to 4.5% in the December quarter from 4.8% in the second quarter, according to the latest data released by the National Bureau of Statistics on Monday. 

The economy expanded at an annual growth rate of 5% in 2025, meeting the target set by the government, as the decline in exports to the U.S. was shrugged off by the rise in shipments to other markets. 

In December, retail sales slowed to a growth of 0.9% from a 1.3% rise in the month earlier and advanced 3.7% on an annual pace. 

Overall fixed investment decreased 3.8%, driven by a 17.2% plunge in property investment in 2025. 

Home prices in the top 70 cities across China continued to decline at an elevated pace, according to a separate report released by the statistical agency on Monday. 

Home price decline accelerated to an annual pace of 3.0% in December from 2.8% in the previous month. 

On a monthly basis home prices fell 0.4% in December, and only six cities registered a gain compared to eight in November. 

The downturn in the property market is likely to persist in 2026, and four top cities are likely to face additional headwinds. 

Prices in Beijing, Shenzhen, and Guangzhou decreased between 0.4% and 0.6%, but rose 0.4% in Shanghai.  

New home prices in tier-2 and tier-3 cities declined 0.4% amid population outflow driven by slower industrial development. 

However, the downturn in existing home prices continued at an elevated pace, and prices fell 0.7% in December from the previous month and plunged 6.1% from a year ago.

China's birth rate declined for the fourth year in a row, and the population shrank in 2025, according to a separate report released by the statistical agency on Monday. 

The number of newborn babies declined to 7.9 million in 2025 from 9.5 million in the previous year, and the number of deaths increased to 11.3 million. 

 

China Indexes and Stocks 

The Hang Seng Index decreased 1% to 26,579.0, and the mainland-focused CSI 300 index fell 0.2% to 4,721.07.  

New World Development Company soared 19% to HK $11.37 after the parent company's chairman said he is open to "partnership" with investors, which could ease the debt burden of the company.