HONG KONG: China and Hong Kong stocks pared some of their weekly gains on Friday, as higher oil prices fuelled inflation fears and dampened investor sentiment.
China’s blue-chip CSI300 Index fell 1.7 percent and the Shanghai Composite Index declined 1.6 percent at the close.
Hong Kong benchmark Hang Seng dropped 1 percent, while Hang Seng Tech lost 1.5 percent. Hang Seng closed the week 1.6 percent higher, a fourth consecutive weekly gain.
Brent crude jumped to above USD100 a barrel after US President Donald Trump promised “major military punishment” for Iran and its Houthi allies on Thursday.
Geopolitical uncertainties and higher oil prices have weighed on broader Asian markets that depend on the Middle East for their oil needs.
China’s CSI 300 and Shanghai Composite ended up 2.7 percent and 1.3 percent respectively for the week, fuelled by China’s securities regulator’s vow to boost stability and the 60 billion yuan (USD8.86 billion) investment by two state-backed funds in equities.
On Thursday, China’s securities regulator pledged to prevent risks in key areas and strengthen policy reserves to respond to global market fluctuations and cross-border risk transmission, according to a meeting readout. Semiconductor and bank stocks gained on Friday, while most other sectors dropped.
“Investors remained cautious ahead of the July Politburo meeting and the anticipated IPO of CXMT, despite continued market stabilisation efforts from the ‘national team’ in recent weeks,” Morgan Stanley analysts said in a note.
Comments