SHANGHAI: China and Hong Kong stocks fell on Monday, led by Chinese state-owned enterprises and tech shares, as China’s industrial profit slump and geopolitical tensions dented sentiment.
** China’s blue-chip CSI300 Index and the Shanghai Composite Index both dropped 1.0% by the lunch break.
** Hong Kong’s benchmark Hang Seng Index was down 0.5%, and the China Enterprises Index lost 1.0%.
** Profits at industrial firms in China declined 22.9% in the first two months of 2023 from the year before, as the factory sector struggles to claw its way out of the slump caused by COVID-related disruptions.
** A senior Communist Party official said on Saturday that the foundation of China’s economic recovery is not solid enough, warning of possible spillover effects from global economic problems.
** Geopolitical tensions also weighed. Putin said on Saturday that Russia would station tactical nuclear weapons in Belarus. ** Shares of Chinese state-owned enterprises dropped, giving up some of this month’s gains. Shares of China Petroleum & Chemical Corp lost 3.4% after the company recorded a 6.9% decline in net income for 2022. Meanwhile, PetroChina Co Ltd slid 2.1%.
China stocks fall on rising Sino-US tensions
** Shares of telecommunication services declined 1.7%, with China United Network Communications Ltd, China Mobile Ltd, and China Telecom Corp Ltd, down 2.9%, 4.1%, and 5.9%, respectively.
** Tech stocks traded in Hong Kong slumped 1.7%, led by Meituan and Xiaomi. Shares of Meituan declined as much as 6.7%, following its fourth-quarter earnings release.
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