SHANGHAI: China and Hong Kong stocks slipped on Monday as a slew of lacklustre economic data and mounting default risks by property developer Vanke weighed on market sentiment.
China’s blue-chip CSI300 Index was down 0.2% by the lunch break, while the Shanghai Composite Index lost 0.1%. Hong Kong’s Hang Seng dropped nearly 1%.
Property shares sank after bondholders rejected China Vanke’s initial plan to push back payment by a year, raising the risk of default for the state-backed developer and renewing concerns about China’s crisis-hit property sector.
Risk appetite was further curbed by data that signalled China’s economy had stalled in November.
New home prices extended declines last month, China’s factory output and retail sales grew at their weakest pace in over a year, and new bank loans rose less than expected.
Investors were also left disappointed by measures announced over the weekend to stimulate consumption, which lacked substance.
“We think the time is coming for ending deflation, truly cleaning up the property mess, and boosting consumption demand via reforming the social welfare system,” said Lu Ting, chief China economist at Nomura.
Shares of Vanke slumped 4% in Hong Kong and 2% in Shenzhen. China’s CSI 300 Real Estate Index fell 1.2%, flirting with record-low levels.
In Hong Kong, the Hang Seng Mainland Property Index softened 0.5%.
China’s SSE STAR Chip Index fell more than 2% after reports that AI giant Nvidia is considering expanding production of its H200 chips following strong Chinese orders.
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