SHANGHAI: China stocks closed slightly lower on Monday as trading resumed following a long holiday and as mixed holiday tourism data failed to convince investors of a strong economic recovery, while overseas uncertainties also curbed sentiment.
Hong Kong shares, meanwhile, were lifted slightly by rising energy shares on the back of surging oil prices amid the military conflict in the Middle East.
The blue-chip CSI 300 Index slipped 0.1% and the Shanghai Composite Index declined 0.4% at close. Hong Kong’s Hang Seng Index edged up 0.2% and the Hang Seng China Enterprises Index added 0.4% in a shortened trading day due to Typhoon Koinu.
Chinese holidaymakers’ spending surged during this year’s eight-day Golden Week holiday, beating pre-pandemic levels but still falling short of government estimates.
“The National Day golden week tourism data, together with the still above-50 September services PMIs, suggest the services recovery has decelerated but continues,” said Goldman Sachs analysts in a note.
“We believe additional policy easing will be necessary for further recovery in consumption and services, especially given the continued property downturn and still-dampened confidence.”
Overseas, US stock futures slid in Asia on Monday as the military conflict in the Middle East boosted oil and Treasuries, while the sizzling September US jobs report raised the rate stakes for inflation figures later in the week.
In China markets, shares in tourism-related companies slumped 4.8% to lead the decline, while real estate developers plunged 1.8%. A survey showed China’s average daily home sales during the Golden Week holiday were down 17%, based on floor area, compared with last year.
Agriculture shares dropped 0.8%, with pig-breeders Muyuan Foods, New Hope Liuhe down 7.6% and 2.7%, respectively. Physical hog prices declined during last week’s National Day holiday due to rising supply and weak demand.
In contrast, shares in automobiles rose nearly 3%.
In Hong Kong, energy shares jumped 2.3%, while tech giants rose 0.2%. Citigroup and J.P.Morgan raised their forecasts for China’s annual growth last week, citing stabilizing economic indicators and Beijing’s recent supportive policy measures.
Separately, China’s Country Garden may announce a restructuring of its offshore debt soon, local media reported, while bondholders of embattled peer China Evergrande Group raised concerns about a possible liquidation as its debt plans floundered. Shares of Evergrande plunged 12.7%, while Country Garden lost 6.7%.
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