SHANGHAI: Hong Kong equities fell on Friday, and were set to snap a six-week winning streak, as US President Donald Trump announced fresh tariffs on Chinese imports and investors booked profit on tech stocks.
China stocks end mixed as factory slump persists
Hong Kong’s benchmark Hang Seng slipped 2.3%. Chinese shares also fell, with the blue-chip CSI300 Index dropping 0.8% by the lunch break and the Shanghai Composite Index losing 0.9%.
Trump on Thursday announced a 10% duty on Chinese imports on top of the 10% tariff that he levied on February 4, taking the cumulative tariff to 20%.
“Trump’s cabinet, especially the members in charge of foreign and trade policies, has exhibited a staunchly hawkish stance towards China,” said Ting Lu, chief China economist at Nomura.
“Nothing is said more clearly than Secretary of State Marco Rubio’ remark: ‘China is the most potent and dangerous near-peer adversary this nation has ever faced’.”
Lu expected tensions between the two mega economies to worsen significantly, especially as China continues to make large strides in high tech, including in AI and robotics.
The Hang Seng Index was set to decline 1.3% for the week, after six weeks of gains, as investors took profit on the tech rally.
“The market could use Xiaomi’s product launch event and Tencent’s new AI launch as catalysts for further profit taking in HSTECH names on Friday,” UBS analysts said.
Tech majors traded in Hong Kong slid nearly 4% on the day, after surging nearly 30% this year. ** AI shares traded onshore shed 3.5%.
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