SHANGHAI: China’s blue-chip index is on track for a third straight weekly gain, while tech shares lifted the Hong Kong benchmark despite Wall Street’s selloff, as China’s stimulus and easing of COVID-19 curbs offset worries about US monetary tightening.
China stocks close down after Fed rate hike
** The CSI300 Index rose 0.3% by the lunch break on Friday, while the Shanghai Composite Index was roughly flat.
** Hong Kong benchmark Hang Seng rose 0.8%, while the Hang Seng Tech Index gained 1.4%.
** In contrast, world stocks headed for their worst week since markets’ pandemic meltdown in March 2020, as investors worried about growth in the face of global rate hikes.
** China stocks, which suffered heavy selling during the first four months of the year, has rebounded over the past month as Beijing unveiled a slew of measures to stimulate a COVID-19-hit economy.
** The city of Beijing on Thursday declared an initial victory in its latest battle with COVID-19. Shanghai ended its two-month virus lockdown in early June and has unveiled a slew of investment projects as the economy re-opens.
** Goldman Sachs said in a report it is “overweight China as policy turns more accommodative and sequential growth momentum recovers from low levels.”
** China’s economy showed signs of recovery in May after slumping in the prior month as industrial production rose unexpectedly, but consumption was still weak.
** The cabinet has pledged to increase annual tax cuts, including VAT credit rebates, to 2.64 trillion yuan ($393.99 billion) from an initial 2.5 trillion yuan, to help spur growth.
** China’s shares in resources, food & beverage and consumer sectors rose, offsetting losses in financials and real estate.
** In Hong Kong, financial and property shares rose, but energy and industrial sectors weakened.
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