SHANGHAI: China and Hong Kong stocks fell on Monday, as tourism data during last week’s three-day Dragon Boat Festival pointed to weak economic recovery.
** China’s blue-chip CSI300 Index and the Shanghai Composite Index both lost 0.7% by the midday recess.
** Hong Kong benchmark Hang Seng Index slipped 0.1% and the Hang Seng China Enterprises Index edged up 0.1%.
** Oil was slightly higher on Monday as an abortive weekend mutiny by Russian mercenaries raised questions about crude supply, while Asian stocks lacked direction as investors waited for more clarity around the situation.
** Trips for tourism in China during the Dragon Boat Festival holiday climbed 32.3% from a year earlier, but the rebound is smaller than that during the five-day May Day holiday.
China stocks plunge most in 2 months on stimulus
** “Tourism and mobility data during the three-day Dragon Boat Festival point to fading post-Covid recovery momentum for in-person services,” said Ting Lu, chief China economist at Nomura.
** Tourism shares fell 2% and consumer staples lost 1.5%.
** S&P Global cut its 2023 GDP growth forecast for China to 5.2% from 5.5% previously, after May data showed a post-COVID recovery was faltering in the world’s second-largest economy.
** Investors are waiting for a big burst of stimulus from China before they make more aggressive bets on a recovery, having spent the past few months disappointed by economic data and a lack of meaningful policy response from Beijing.
** Artificial intelligence stocks slumped 3.4% following last session’s 5% plunge.
** Tech giants listed in Hong Kong edged up 0.3%.
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