China stocks close down as COVID woes drag on


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SHANGHAI — China stocks closed lower on Thursday, defying a rally in other Asian markets, as lingering domestic COVID-19 outbreaks kept sentiment subdued and clouded the economic outlook.

Hong Kong’s main benchmark, meanwhile, dropped for a sixth consecutive session, hovering around a half-year low.

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** The blue-chip CSI 300 Index closed 0.4% lower, while the Shanghai Composite Index lost 0.3%.

** The Hang Seng Index fell 1%, and the Hang Seng China Enterprises Index dropped 1.2%. Both indexes closed at their lowest level since March 15.

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** Other Asian stocks gained, extending an overnight global rally, as investors awaited U.S. Federal Reserve Chair Jerome Powell’s speech later in the day for signs of any let-up in the central bank’s hawkish approach to tame inflation.

** Chengdu, the capital of the southwestern Chinese province of Sichuan, extended a lockdown in most of its districts on Thursday, to stem further transmission of COVID-19 in the city of 21.2 million people.

** Semiconductors went down 1.3%, and new energy shares declined 1.5%.

** Tourism-related shares and transport companies rose 2.2% and 1.2%, respectively.

** Oil prices settled sharply lower on Wednesday, slumping below levels seen prior to Russia’s invasion of Ukraine as downbeat Chinese trade data fed investor worries about recession risks.

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** Energy shares lost 1.6% in mainland market, while tumbling 3.2% in Hong Kong.

** The Chinese city of Zhengzhou vowed to start building all stalled housing projects within 30 days. However, mainland property developers listed in Hong Kong fell 2.4%.

** The Hang Seng Tech Index closed 1% lower, with Tencent plunging 3.2% to become the biggest drag on the Hang Seng benchmark.

** Brokers say Tencent shares worth about HK$58 bln ($7.4 bln) appeared in Hong Kong’s clearing and settlement system, triggering speculation that a major shareholder is gearing up to unload some shares.

** Data on Wednesday showed China’s exports growth weakened in August, and research firms including Nomura said it might be finally becoming a real drag.

** However, “the rapid fall in export growth could perhaps force Beijing to rethink its domestic policy stance on the property sector, its zero-COVID strategy, e-commerce and others,” Nomura said in a note. (Reporting by Shanghai Newsroom; editing by Uttaresh.V and Krishna Chandra Eluri)



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