HONG KONG: Chinese stocks extended losses on Monday to three-month lows despite authorities’ efforts to shore up the market, as concerns over economic recovery and geopolitical tensions weighed.
The blue-chip CSI 300 closed down 0.2% to its lowest level since Sept. 27, extending a 5.2% drop last week. The Shanghai Composite index slipped 0.1% to 3,206.92 points.
The consumer staples sector lost 1.9% and the liquor distiller sector tumbled 2.9%, leading declines onshore.
Hong Kong’s benchmark Hang Seng Index weakened 0.4% to 19,688.29.
Sentiment towards Chinese assets remained fragile, with investors concerned about the country’s economic recovery, the rollout of domestic policy support, and escalating geopolitical tensions upon US President-elect Donald Trump’s return to the White House.
China’s services activity expanded at the fastest pace in seven months in December but orders from abroad declined, reflecting growing trade risks to the economy, a private sector survey showed.
Global trades, supply chains, capital flows and economic growth in 2025 are all facing uncertainties from geopolitical dynamics and may undermine investors’ confidence, Bank of America strategists said in a client note.
“We advise investors to stay vigilant, (and) start defensive in early 2025,” they said.
To stabilize volatility, Shanghai and Shenzhen exchanges met with foreign institutions over the weekend, with both bourses pledging to continue opening up China’s capital markets.
They have also asked some large mutual funds to restrict stock selling, Reuters reported.
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