by Zhang Shidong at scmp.com
Hong Kong stocks completed a second week of losses on concerns the downturn in China’s property market will persist and the slowdown in economic growth will deepen.
The Hang Seng Index fell 0.9 per cent to 19,075.19 at the close. The benchmark finished the week with a 2.4 per cent decline, extending a 1.9 per cent drop in the previous five-day period. The Hang Seng Tech Index dropped 2.4 per cent, while the Shanghai Composite Index retreated 2 per cent, its steepest decline since October 28.
Country Garden Holdings tumbled to close below HK$1 for the first time since its 2007 listing after the Chinese property developer forecast a huge loss for the first half. MTR, the city’s subway operator, dropped after first-half results trailed projections. Alibaba Group Holding bucked the decline on the broader market after revenue for the quarter ended June increased by the most in a year and profit beat estimates.
“Investors are still awaiting detailed policy measures and implementations, especially amid Country Garden’s missing bond payments and continued weakness in property sales,” said Goldman Sachs in a research note. “We expect policymakers to roll out modest easing measures with a combination of monetary, fiscal, property and consumption support in the coming months.”
Lack of conviction about more forceful supportive measures has sidelined investors, who are disappointed by the absence of follow-up stimulus after a July Politburo meeting chaired by Party chief Xi Jinping hinted at a more dovish tone on spurring growth. Concerns about a deteriorating growth outlook have intensified after the latest data showed that exports declined by the most in three years last month and both consumer and producer prices slid into deflationary territory.
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