SHANGHAI: China stocks closed roughly flat on Friday but ended the week higher, as onshore investors rebuilt positions after the Lunar New Year holiday, hoping the upcoming National People’s Congress will back technology and innovation. Hong Kong shares were up.
China’s blue-chip CSI300 Index closed 0.3 percent down, while the Shanghai Composite Index edged 0.4 percent higher. Hong Kong’s benchmark Hang Seng Index climbed 1 percent.
The CSI300 Index ended the holiday-shortened week 1.1 percent higher, while the Hang Seng Index has climbed 0.8 percent.
Onshore sentiment has improved as investors rebuilt equity positions post-holiday, state-linked funds paused heavy selling, and expectations grew that the upcoming National People’s Congress will unveil policies supporting technology, innovation, and domestic consumption, analysts at Morgan Stanley said in a note.
The closely watched annual parliamentary meeting will begin on March 5, state media reported in late December.
Hong Kong-listed tech majors rebounded slightly but finished the week down 1.4 percent. The recent pullback in the Hang Seng Tech Index suggests some investment flows may be shifting toward consumer stocks, UBS analysts said, noting that sentiment remains positive on low valuations, reflation trades, and early strength in sectors such as baijiu (China’s strong distilled liquor), dairy, and other staples.
Onshore consumer staple shares rose 0.6 percent.
China’s yuan halted a long rally on Friday after authorities made their strongest pushback yet against its gains by cutting the cost of buying dollar forwards.
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