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Hong Kong stocks set to snap winning streak amid US-China trade tensions
The Hang Seng China Enterprises Index dropped 3.2%, led by tech firms, following new US restrictions on chip exports to China.
Chinese stocks in Hong Kong are set to snap a six-day winning streak, as renewed fears of an expanding US-China trade war weigh on sentiment.
The Hang Seng China Enterprises Index tumbled as much as 3.2%, with technology firms including Meituan, Kuaishou Technology and JD.com Inc. leading the declines. The mainland benchmark CSI 300 Index dropped as much as 0.9%. Both indexes were among Asia’s worst performers on Wednesday.
Also read: China, Hong Kong stocks drop as trade war anxiety outweighs GDP data
The declines came after the Trump administration imposed new restrictions on Nvidia Corp.’s chip exports to China, a move that’s raised concerns about how the curbs may escalate trade tensions beyond import taxes. The fallout could weigh on chip-sector earnings and set back China’s ambitions to compete on the global artificial intelligence stage.
Also read: Stocks market expected to open lower today after erasing Trump tariff-induced losses
“The underperformance for HK stocks is driven by concerns of the US China trade war extending to non-tariff measures, such as increasing restrictions on US technology and possibly financial markets,” said Gary Tan, a portfolio manager at Allspring Global Investments. The Nvidia disclosure “is likely to lead to some near-term slowdown in China AI development,” he said.
