Hong Kong stocks make a dismal start to 2024 after China PMI report hints

Hong Kong stocks make a dismal start to 2024 after China PMI report hints at sustained economic weakness

Hong Kong stocks dropped on the first trading day in 2024 after an official Chinese manufacturing report showed a contraction for a third straight month in December.

The Hang Seng Index fell 0.8 per cent to 16,907.16 as of 9.49am local time. The Hang Seng Tech Index shed 0.7 per cent and the Shanghai Composite Index retreated 0.1 per cent.

E-commerce giant Alibaba Group dropped 1.4 per cent to HK$74.55 and its peer JD.com lost 3.3 per cent to HK$108.80. Chinese electric-vehicle maker Li Auto slumped 5 per cent to HK$139.90 and drug maker Wuxi AppTec lost 4.1 per cent to HK$76.05. Chinese sportswear maker Li Ning fell 3.6 per cent to HK$20.20.

The purchasing managers’ index (PMI) of the manufacturing industry dropped to 49 from 49.4 in November, staying below the 50 reading that divides expansion and contraction for a third straight month, the National Bureau of Statistics said over the weekend. Separately, a private PMI report compiled by Caixin showed that a similar index rose to 50.8.

The Hang Seng Index fell 14 per cent last year, making it the worst among major stock gauges globally. The four consecutive years of annual declines was the longest losing streak on record for the 82-member benchmark during which the index tracking Asia’s third-largest market has lost over 40 per cent. The entire market lost more than US$520 billion in value in 2023, according to Bloomberg data.

Other major Asian markets were mixed. South Korea’s Kospi retreated 0.2 per cent and Australia’s S&P/ASX 200 added 0.3 per cent. Japan’s market is closed for a public holiday.