Hong Kong Stocks Decline Amid Mixed Earnings and China Fiscal Stimulus Prospects

Hong Kong Stocks Hit by Mixed Earnings Results

Hong Kong stocks dropped, hitting the brakes on three days of gains, as investors assessed a mixed bag of earnings results while they await a critical legislative meeting in China that could yield new fiscal stimulus. The Hang Seng Index fell 0.5 per cent to 20,590.12 as of 10.11am local time. The Hang Seng Tech Index dropped 1 per cent. Benchmarks on the mainland were also weak: the CSI 300 Index slipped 0.1 per cent and the Shanghai Composite Index was little changed.

Focus Shifts to National People’s Congress Meeting

China Merchants Bank, the nation’s biggest retail lender, dropped 1.3 per cent to HK$38.80 after reporting a net income decrease of 0.6 per cent from a year earlier in the first nine months of 2024. Home appliances maker Haier Smart Home also fell 1.3 per cent to HK$29.40 after its third-quarter profit missed analysts’ expectations. Pork processor WH Group rallied 1.3 per cent to HK$32.30 after its profit more than doubled in the first nine months of the year.

Investors are gearing up for the National People's Congress Standing Committee meeting next week. Traders have set a high bar for its outcome, as the more than 20 per cent gains in China and Hong Kong markets since late September have priced in the prospect of fiscal support for the economy. For the rally to be sustainable, legislators would need to approve at least 2 trillion yuan (US$280 billion) of fiscal stimulus, according to top investment banks.

Mixed Performance Across Asian Markets

New-energy material maker Jiangsu Lopal Tech dropped 6 per cent to HK$5.17 on its first day of trading in Hong Kong. Other major Asia-Pacific markets were mixed: Japan’s Nikkei 225 climbed 1 per cent, while South Korea’s Kospi retreated 0.3 per cent and Australia’s S&P/ASX 200 lost 0.5 per cent.