Hong Kong, mainland China stocks fall as Fed rate-cut expectations dip
Market sentiment ‘turned weak as some investors decided to lock up gains over the past two days’, analyst says
Hong Kong and mainland China stocks fell following an overnight slide in the key US stock gauges amid lower expectations for interest-rate cuts by the Federal Reserve and a tight US presidential election that will determine the future of its relationship with China.
The Hang Seng Index dropped 1.3 per cent to 20,489.62 at the close. The Hang Seng Tech Index tumbled 2.6 per cent to 4,483.99.
On the mainland, the CSI 300 Index slid 1.1 per cent and the Shanghai Composite Index lost 0.7 per cent.
“Market sentiment in both Hong Kong and the mainland turned weak as some investors decided to lock up gains over the past two days by reducing their holdings,” said Ivan Li, a fund manager at Loyal Wealth Management in Shanghai. “The market outlook remains cloudy since most investors are cautious on equity investment before China unveils a strong stimulus package to buoy the slowing economy and the embattled property sector.”
The S&P 500 declined 0.9 per cent on Wednesday as traders were suspicious about further rate cuts in the US over the two remaining Fed policy meetings.
In addition, as the world is waiting for the fast-approaching US election, Beijing may be holding onto new policy measures until after the election result, according to Dickie Wong, executive director at Kingston Securities.
