Hong Kong stocks trade close to 2-week low as Fed minutes curb wagers on aggressive rate cuts

The Hang Seng Index fell 0.5 per cent to 16,563.38 as of 10.08am local time, heading for the lowest close since December 22. The Hang Seng Tech Index slipped 0.1 per cent, while the Shanghai Composite Index retreated 0.4 per cent.

Limiting the losses, CNOOC advanced 2.8 per cent to HK$13.36 and PetroChina added 2.1 per cent to HK$5.34 after crude oil futures rose above US$73 a barrel for the biggest gain in almost seven weeks.

Technology stocks led the declines in US equities overnight and gold futures trended lower after the Fed dampened bets on aggressive cuts in borrowing costs.

Meanwhile, the Caixin purchasing managers’ index (PMI) of the services industry rose to 52.9 in December from 51.5 in the previous month, remaining in the expansionary zone for 12 months in a row.

Hong Kong stocks have extended their weakness into the new year, as worries about China’s growth outlook lingers and overseas traders tamp down their expectations about an imminent rate cut in the US. The Hang Seng Index fell 2.4 per cent over the past two trading days after a 14 per cent decline last year.

Other major Asian markets fell. Japan’s Nikkei 225 slid 1.4 per cent as the market started trading for the first time in 2024. South Korea’s Kospi retreated 0.7 per cent, while Australia’s S&P/ASX 200 lost 0.3 per cent.