China, Hong Kong stocks mixed on COVID easing hopes, weakening PMI data
HONG KONG — China stocks move higher in a choppy session on Wednesday, while Hong Kong shares were mixed, as investors clung to hopes that China will soon reopen its economy, despite rising COVID cases.
The reopening hopes partially offset worse-than-expected factory and service activity data.
China’s blue-chip CSI 300 Index rose 0.28%, while the Shanghai Composite Index was up 0.21%.
Hong Kong’s Hang Seng Index was up 0.22%, while the Hang Seng China Enterprises Index was off 0.06%.
China’s factory activity contracted at a faster pace in November, an official survey showed on Wednesday, weighed down by COVID-19 curbs and softening global demand.
The official manufacturing purchasing managers’ index (PMI) stood at 48.0 against 49.2 in October, the lowest reading in seven months
“Economic activities will likely weaken further in December and the first quarter,” said Zhiwei Zhang, president and chief economist at Pinpoint Asset Management.
“Nonetheless the market sentiment is improving as investors look through the weak economic data in the short term. The key question on investors’ minds is how long this reopening process will take.”
In China, auto stocks led the gains due to strong October sales figures despite the COVID impact, and market expectations on further car purchase tax cut benefits.
The CSI all share automobiles index surged 6.4% and new energy vehicles were up 2.2%.
In Hong Kong, Geely Auto rallied 8%, tech firms were flat and Hong Kong-listed mainland properties dropped 2.2%.
HSBC Holdings’ Hong Kong-listed shares climbed 1.7% as the bank has agreed to sell its business in Canada to Royal Bank of Canada for C$13.5 billion ($10 billion) in cash, paving the way for a potential bumper payout for shareholders later down the line. (Reporting by Summer Zhen; Editing by Savio D’Souza)
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