The Hang Seng Index dropped 0.5 per cent to 16,742.08 as of 11.34am. The benchmark on Friday closed at its lowest level since November 10, 2022. The Hang Seng Tech Index slid 1.3 per cent and the Shanghai Composite Index fell less than 0.1 per cent.
Wuxi Biologics tumbled 24 per cent to HK$33.15 before trading was suspended. Earlier the drug maker release a business update that expects a challenging industry landscape ahead. Its affiliate Wuxi Apptec slid 5.7 per cent to HK$86.25. Alibaba Group dropped 0.9 per cent to HK$71.20 and online game operator NetEase sank 4.1 per cent to HK$168.60. Chinese EV maker Li Auto slumped 4.4 per cent to HK$139.90, as the stock was included in the Hang Seng Index alongside Wuxi Apptec starting Monday.
Limiting losses, gold producer Zijin Mining Group surged 3.8 per cent to HK$12.60 as bullion prices rose to a record after comments by the Federal Reserve Chair, Jerome Powell, that policy was “well into restrictive territory” was taken as a clue by markets there was a greater chance of rate cuts next year.
China’s exports probably dropped 1.2 per cent in November, while both consumer and producer prices may have plunged into the deflationary territory, according to the consensus estimates of the economists tracked by Bloomberg. The data is due this week.
“The key problems for China’s economy are insufficient domestic demand, local-government debts and the clean-up of the property market,” said Yang Liu, an analyst at China Post Securities. “The market focus is now on the follow-up policies and expectations about the economic recovery. Investors are now waiting for more signals of the policies that can set expectations for the economy next year.”
Statements from Chinese institutional investors had given the markets an early boost, which quickly faded on the economic jitters. State-backed China Reform Holdings said in a statement after markets shut on Friday that it bought an unspecified amount of an ETF tracking onshore technology stocks. That came just two days after two top Chinese insurers unveiled a plan to launch a 50 billion yuan fund that would invest in yuan-traded stocks.
China will continue to implement proactive fiscal policies next year and has ample room for cutting banks’ reserve requirement ratio, the Shanghai Securities News reported, citing Sheng Songcheng, a former statistics and analysis director of the People’s Bank of China.
Other major Asian markets were mixed. Japan’s Nikkei 225 slipped 0.6 per cent, while South Korea’s Kospi rose 0.5 per cent and Australia’s S&P/ASX 200 added 0.6 per cent.