SHANGHAI: Chinese stocks closed lower on Wednesday due to bumpy economic recovery after the country dropped its strict zero-COVID policy and as uneven first-quarter macro data weighed on sentiment.
China’s blue-chip CSI 300 Index was down 0.9%, while the Shanghai Composite Index finished 0.7% lower.
The Hang Seng Index fell 1.4%, while the Hang Seng China Enterprises Index declined 1.6%. China reported higher-than-expected first-quarter growth on Tuesday but some data pointed towards uneven recovery trends. Real estate developers led declines with a 2.6% drop, after Tuesday’s data showed property investment fell 5.8% from a year earlier.
The data also showed factory output growth was just below expectations, while retail sales growth hit nearly two-year highs.
“We caution (that) some strengths, such as pent-up demand and catch-up production post the COVID ‘exit wave’, may fade sequentially in coming months,” Goldman Sachs said in a note.
China is drafting proposals to boost economic recovery and expand consumption, state planner spokesperson Meng Wei said on Wednesday.
Separately, a Reuters survey showed China is widely expected to stand pat on lending benchmarks at the monthly fixing on Thursday. Amid weak sentiment, however, some investors continued to bet on AI stocks. Frenzy around Chinese equivalents of OpenAI’s ChatGPT chatbot boosted shares of companies in the tech, media and telecom (TMT) sector.
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