HONG KONG: China stocks were flat on Wednesday, as gains in shares of liquor giant Kweichow Moutai were partially offset by caution following data that signalled a bumpy recovery in the world’s second-largest economy.
Hong Kong shares were trading within a narrow range as traders maintained a risk-off stance ahead of the US Federal Reserve’s monetary policy decision due later in the day.
China’s blue-chip CSI 300 Index was flat and the Shanghai Composite Index edged 0.14% higher.
Hong Kong’s Hang Seng Index was largely unchanged.
The factory activity in China unexpectedly contracted in October, a private survey showed on Wednesday, raising questions over the state of the country’s fragile economic recovery at the start of the fourth quarter.
Shares of Kweichow Moutai jumped 5.7% after the Chinese top liquor maker announced plans to raise the ex-factory prices of its signature liquor products containing 53% alcohol by about 20% from Nov. 1, the first price hike in nearly six years.
Gains in the index heavyweight improved some sentiment in the wider A-share market. The CSI food and beverage sub-index rose 1.6%.
“The price increase is unexpected ... this will not only contribute to Moutai’s forth-quarter results, but also ease some of the local debt pressure of Guizhou province - Kweichow Moutai’s hometown,” Huatai Securities analysts said in a note.
On the geopolitical front, tensions between Washington and Beijing showed signs of easing.
US President Joe Biden and his Chinese counterpart Xi Jinping are aiming to have a “constructive conversation” on the sidelines of the Asia Pacific Economic Cooperation forum in San Francisco in mid-November, the White House said.
Hong Kong-listed Chinese tech firms slipped 0.2%.
Hong Kong shares of Yum China plummeted 13% after the operator of the KFC chain in mainland China said it observed softening consumer demand in late-September until October.
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