HONG KONG: China and Hong Kong stocks extended losses on Monday as economic data pointed to a slowdown in growth momentum, while a plunge in WuXi Biologics (Cayman) Inc’s shares on its disappointing forecast further dragged the markets down.
The blue-chip CSI 300 Index dipped 0.7%, while the Shanghai Composite Index was down 0.3%.
Hong Kong’s Hang Seng Index dropped 1.1%, hovering around the lowest level in more than a year. Tech giants listed in Hong Kong fell for a fifth straight session, sliding 1.9%.
Chinese pharma tech giant WuXi Biologics’ shares were suspended from trading in Hong Kong in the morning after it fell over 23%.
The company on Monday said it expects to see lower revenue growth from development as its 2023 goal was overtly bullish to add 120 projects despite the downturn, while biotech funding constraints resulted in fewer new integrated projects added.
Its sister company WuXi AppTec Co also declined 8.8%.
The Hang Seng Healthcare Index lost 5%, while healthcare companies listed in China A-shares fell 3%, following the WuXi Biologics announcement.
Investor sentiment continues to be downbeat due to China’s challenging growth environment, reflected in the recent economic data.
Mixed factory activity data for China in November suggests more stimulus will be needed to shore up economic growth.
Barclays analysts think the moderating manufacturing purchasing managers’ index (PMI) and contracting services PMI, along with November high frequency data show the fragility of the recovery.
“We expect GDP growth to moderate to 2.8% on quarter in Q4, versus 5.6% in Q3, despite the year-end fiscal stimulus,” they said.
Meanwhile, in the property sector, China Evergrande Group on Monday said it has been granted an adjournment of a court hearing into a liquidation petition to Jan. 29, giving the developer time to finalise a revamped offshore debt-restructuring plan. Shares of Evergrande jumped 9 percent.
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