Tuesday, 24 March 2015 17:10
HONG KONG: Hong Kong stocks slipped 0.39 percent Tuesday after a gauge of Chinese manufacturing hit an 11-month low, but Shanghai rose as the data fuelled hopes for further government stimulus.
The benchmark Hang Seng Index eased 94.91 points to 24,399.60 on turnover of HK$ 89.74 billion ($ 11.58 billion).
HSBC’s preliminary purchasing managers’ index (PMI) for March came in at 49.2, indicating manufacturing activity contracted and the latest sign that the Chinese economy is struggling.
The figure is well down from February’s 50.7 and far off the 50.5 forecast in a Bloomberg survey. Anything below 50 indicates contraction and a reading above points to growth.
Julian Evans-Pritchard, China economist at Capital Economics in Singapore said the reading “is the latest in a string of disappointing data out of China and strengthens our view that the economy likely slowed sharply in” the first quarter of 2015.
He tipped Beijing to unveil fresh easing measures, following two rate cuts between November and February, and a step-up in fiscal spending.
Among losing firms, PetroChina eased 1.57 percent to HK$ 8.17 and CNOOC shed 0.77 percent to HK$ 10.34.
Internet giant Tencent fell 1.52 percent to HK$ 143.00, HSBC retreated 0.37 percent to HK$ 67.10 and insurer Ping An sank 2.57 percent to HK$ 91.05.
In mainland China, the benchmark Shanghai Composite Index rose for its tenth-straight session, adding 0.10 percent, or 3.68 points, to 3,691.41 on turnover of 754.9 billion yuan ($ 123.0 billion).
The Shenzhen Composite Index, which tracks stocks on China’s second exchange, rose 1.01 percent, or 19.21 points, to 1,922.85 on turnover of 661.4 billion yuan.
“The market is higher on hopes of further easing after the weak manufacturing data,” Zheshang Securities analyst Zhang Yanbing told AFP.
Shanghai has rallied for 10 sessions since Premier Li Keqiang earlier this month said the government had the firepower to support the economy if it continued to struggle, fuelling expectations it will soon add to its rate cuts.
“The economy is still sliding,” Wu Kan, a fund manager at Dragon Life Insurance, told Bloomberg News. “But China is in the process of adjusting the structure of the economy so the market can tolerate slower growth.”
Airlines were among the biggest winners in Shanghai. China Southern Airlines gained 6.64 percent to 8.51 yuan, while China Eastern Airlines rose 6.61 percent to 7.58 yuan.
But securities firms were lower. In Shanghai, Citic Securities lost 2.61 percent to 32.45 yuan and Dongxing Securities fell 3.92 percent to 24.05 yuan.
Copyright AFP (Agence France-Presse), 2015
