China stocks fall as COVID flare-ups weigh

SHANGHAI: China stocks fell on Tuesday as rising COVID cases raised fears of a further slowdown in economic growth, while investors grew increasingly worried about the property sector after homebuyers threatened to stop mortgage payments on unfinished apartments.

The CSI300 index fell 0.9% to 4,254.16 by the end of the morning session, while the Shanghai Composite Index lost 0.3% to 3,268.52. The Hang Seng index dropped 1.2% to 20,605.64.

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The Hong Kong China Enterprises Index lost 1.2% to 7,079.91.

** Asian shares slipped, following overnight declines on Wall Street, while traders’ main focus was approaching central bank meetings and the early stages of the US earnings season.

** Nomura said 41 Chinese cities were currently implementing full or partial lockdowns or some kind of district-based control measures, affecting 22.8% of the country’s gross domestic product.

** “The COVID-19 outbreaks dent market sentiment to some extent, but the main concern is still the sustainability of an economic recovery, while there are also worries over the slowing property sector,” said Wang Mengying, a stock index futures analyst at Nanhua Futures.

** She said market participants’ focus would be on the July Federal Reserve meeting and China’s property sales for the month. ** China may allow homeowners to temporarily halt mortgage payments on stalled property projects without incurring penalties, Bloomberg News reported.

** The report comes as growing numbers of homebuyers have threatened to halt mortgage payments until developers resume construction of pre-sold homes, deepening concerns about the property sector, which accounts for a quarter of the economy, and raising fears banks could face hefty writedowns.

** Meanwhile, US House of Representatives Speaker Nancy Pelosi plans to visit Taiwan in August, the Financial Times reported.

** Healthcare dropped 1.6%, semiconductors fell 1.2%, and new energy declined nearly 2%.

** Stock index futures and options based on China’s small-cap CSI 1000 Index will start domestic trading on July 22, China’s securities regulator said, offering investors fresh risk hedging tools.

** In Hong Kong, both tech giants and mainland developers retreated 1.6%.