SHANGHAI: China and Hong Kong stocks steadied on Friday after the previous session’s slump, as authorities moved to assuage investors worried about China’s economy and a looming trade war with the US.
However, the Chinese market is set to post its biggest weekly loss in almost a year, underscoring waning sentiment in the absence of fresh policy stimulus, and ahead of Donald Trump’s presidential inauguration on Jan. 20.
China’s blue-chip CSI300 Index was roughly flat by the lunch break, while the Shanghai Composite Index dipped 0.5%. For the week, both gauges are poised to lose more than 4%, thanks to Thursday’s roughly 3% slump.
In Hong Kong, the benchmark Hang Seng Index rose 0.9%.
“Trump’s tariff policy is the sword of Damocles,” Huaan Securities said in a note, attributing weakened confidence to signs of persistent economic weakness and absence of policy announcements in January.
In an apparent move to pacify jittery investors, China’s securities regulator vowed late on Thursday to crack down on the fabrication and dissemination of rumours that had contributed to market slides.
In another market-friendly gesture, China’s central bank said it had conducted a second round of swap facility operation worth 55 billion yuan ($7.53 billion) to bolster the stock market.
China’s economy will face many new difficulties and challenges in 2025 and there is ample room for macro policies, China’s top state planner told a news conference on Friday.
Meanwhile, China’s central bank told the Financial Times that it is likely to cut interest rates from the current level of 1.5% “at an appropriate time” in 2025.
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