SHANGHAI: The Shanghai stock benchmark ended largely unchanged on Friday, while Hong Kong shares inched higher, as investors held out hope for more fiscal support at home even as they awaited a fresh catalyst from overseas markets following a recent global bond sell-off.
At the close, the Shanghai Composite index was flat at 3,905.20 points, while the blue-chip CSI300 index climbed 0.6 percent.
For the week, the SSEC lost 0.6 percent, while the CSI300 fell 1 percent.
Trading volume of A shares fell on Friday to 1.88 trillion yuan (USD279.75 billion), marking the lowest level since April 7.
The start-up board ChiNext Composite index was higher by 1.4 percent and Shanghai’s tech-focused STAR50 index closed flat.
“China is still struggling for traction,” said Wee Khoon Chong, APAC macro strategist at BNY.
“The Shanghai Composite and STAR50 were flat despite comments from the Finance Ministry that additional fiscal support may be considered in the second half of the year. The muted reaction suggests policy expectations are already elevated, and investors still want clearer evidence of stronger domestic demand before adding risk.”
China will implement additional fiscal policy measures in response to economic developments, Vice Finance Minister Liao Min said on Friday, as growth slows in the world’s second-biggest economy.
A string of July data, ranging from industrial output and retail sales to credit lending, showed the world’s second-largest economy grappling with persistently weak domestic demand.
Non-ferrous metal shares were among the top gainers, with a sub-index rising 2.7 percent, reflecting higher gold prices on the back of a weaker dollar and US Treasury’s bond buyback move.
In Hong Kong, the benchmark Hang Seng index advanced 1.2 percent, while the city’s tech shares gained 1.4 percent.
Market participants will soon shift their attention to Federal Reserve Chairman Kevin Warsh’s speech at the central bank’s Jackson Hole symposium next week for clues on how he plans to tackle still-elevated inflation.
The US Treasury’s surprise bond buyback failed to quell lingering concerns about inflation and expanding government debt.
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