The Hang Seng Index closed down 1.8% to 17,729.29, adding to last week’s 0.7% decline. The Hang Seng High-Tech Index fell 2.7%, and the Shanghai Composite Index fell 0.5%.
“China’s real estate crisis is not over yet, and this will lead to higher stock prices,” said Wang Zheng, chief investment officer at Jingxi Investment Management in Shanghai. “The real estate market is extremely important to China’s economy given its size and weight. No other industry can replace it as a means of stabilizing the economy in the near future.”
According to China Galaxy Securities, the real estate sector alone accounted for 6.1% of China’s economy last year, and industries related to the real estate market could contribute about a quarter of the economy.
Domestic stocks fell for the third week in a row last week as traders worried that China’s gradual stimulus measures were not enough to stem the slowdown in economic growth. So far, the Chinese government has lowered mortgage rates for first-time home buyers, removed purchase restrictions in some major cities and lowered bank reserve requirements, but these efforts have failed to cheer investors. There wasn’t. The Hang Seng Index fell more than 6% in the three months to September, heading for its second consecutive quarter of decline.
BlackRock loses confidence in Chinese stocks as losses widen due to real estate slump
BlackRock loses confidence in Chinese stocks as losses widen due to real estate slump
Four companies made their trading debut on Monday. LC Logistics fell 0.6% to HK$5.10, while Wuhan YZY Biopharma remained unchanged at HK$16 from its Hong Kong offering price. Jiangsu Hengxing New Materials Technology, which makes chemical products, rose 19% to 30.54 yuan in Shanghai, while Anhui Wanbang Pharmaceutical Technology rose 9% to 74 yuan in Shenzhen.
Elsewhere, mainland-traded Huawei suppliers soared ahead of new product launches by the communications equipment maker, which could include smart cars and the MatePad Pro. Wuhu Sanlian Forging increased its daily limit by 10% to 40.73 yuan, and Dongguan Chitwing Technology similarly soared to 39.53 yuan.
Other major Asian markets were mixed. Japan’s Nikkei Stock Average rose 0.9%, while South Korea’s Kospi Index fell 0.5% and Australia’s S&P/ASX 200 Index rose 0.1%.