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Hong Kong stocks end three-day winning streak before report signalling China slowdown risks
- Geely Auto, Xinyi Solar and BYD surrendered some of their advances earlier this week
- China’s second-quarter GDP is seen slowing to 8 per cent from 18.3 per cent in the preceding three months, according to market consensus
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Zhang Shidongin Shanghai
Hong Kong stocks dropped for the first time in four days as traders focused on a government report signalling China’s economic rebound may have faltered last quarter.
The Hang Seng Index fell 0.6 per cent to 27,787.46 at the close of Wednesday trading. The benchmark rallied 3 per cent in the previous three days after China’s central bank lowered banks’ reserve-requirement ratio (RRR). The Hang Seng Tech Index added 0.1 per cent for a fourth day of gains. The Shanghai Composite Index slid 1.1 per cent.
Trade linked to the new-energy sector waned, as stocks surrendered some of their advances earlier this week. Electric-vehicle makers BYD and Geely Automobile dropped more than 2 per cent and Xinyi Solar Holdings sank 4.7 per cent.
Sentiment was cautious before the release of China’s second-quarter growth report on Thursday. The world’s second-largest economy probably grew 8 per cent, slowing from an 18.3 per cent expansion in the opening three months this year, according to the median of forecasts tracked by Bloomberg.
Some economists predicted below-projection performance, saying the unexpected cut in the reserve ratio with effect from July 15 indicated the need for policymakers to intervene and arrest a deeper slowdown.
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