SHANGHAI: China and Hong Kong stocks were largely flat on Monday as investors grew cautious with US President Donald Trump’s tariff deadline approaching and no new market stimulus in sight.
China stocks end mixed as factory slump persists
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China’s blue-chip CSI300 Index edged up 0.2% by the lunch break, while the Shanghai Composite Index lost 0.3%. Hong Kong benchmark Hang Seng was down 0.1%.
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US President Donald Trump’s top trade chief, Jamieson Greer, plans to speak with his Chinese counterpart this week, ahead of the long-threatened April 2 unveiling of fresh US tariffs on countries taxing US imports, potentially including new steps against China. Market participants are watching closely for tariff headlines.
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Meanwhile, US Republican Senator Steve Daines met Chinese Premier Li Qiang in Beijing with a group of executives from US companies on Sunday, following an annual business summit in the capital attended by CEOs from big foreign firms.
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“The ongoing US-China tensions may erode external demand, sap domestic investment, squeeze manufacturers’ margins, and dent workers’ pay,” said Ting Lu, chief China economist at Nomura.
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As growth could face much stronger headwinds in the second half of the year, Lu expects Beijing to be pressured into increasing stimulus measures to stabilise growth, particularly in service consumption.
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China’s central bank reiterated its stance to cut banks’ reserve requirement ratio and interest rates at an “appropriate time” during a quarterly meeting of its monetary policy committee.
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Wall Street firm Morgan Stanley raised its 2025 GDP growth forecast for China by 50 basis points to 4.5%, citing the impact of stimulus measures on local governments and consumption that have started to filter through “leading to green shoots”.
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Non-ferrous metals shares rose 1.5% in China, while property shares dropped 1.1%.
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Sentiment for Hong Kong tech majors stayed downbeat, with shares slipping 0.2%.
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