SHANGHAI: China and Hong Kong stocks sagged on Monday, as weak local data on industrial and retail sales highlighted ongoing economic challenges, although the Sino-US tariff reprieve continued to lift shares of port operators.
China, HK stocks dip with earnings
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China’s blue-chip CSI300 Index dropped 0.4% by the lunch break, while the Shanghai Composite Index lost 0.1%. Hong Kong benchmark Hang Seng traded 0.5% lower.
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China and Hong Kong markets have recovered ground lost since Donald Trump’s “Liberation Day” tariffs in early April, as Beijing and Washington announced a 90-day tariff pause last week. But the rally appears to be losing steam.
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Official data showed on Monday that growth in China’s industrial output and retail sales slowed in April, curbing risk appetite.
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Guosheng Securities cautioned investors against chasing stocks “before concrete evidence points to a better-than-expected economy.”
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“Fluctuation within a wide range remains our base case scenario,” the brokerage wrote. ** But shares of Chinese port operators continued to surge, as investors doubled down on bets that the 90-day tariff pause will spur a rush in shipment.
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Lianyungang Port, Ningbo Port and Zhuhai Port all hit their daily upward limit of 10%. Shares of other major port operators such as China Merchants Port Group and Shanghai International Port also rose sharply.
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“Exporters may continue to boost production and delivery in the next few months in case tariffs are hiked again down the road,” said Zhiwei Zhang, president, Pinpoint Asset Management.
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China Securities Co analysts said the tariff reprieve may “spur a shipment rush that leads to a burst of businesses” for port operators.
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Hong Kong-listed shares of Midea Group and ZTO Express jumped after the Hang Seng Indexes Co said they would be added to the Hang Seng Index early next month.
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Shares of China Literature plunged more than 8%, on announcement it would be removed from the Hang Seng Tech Index.
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