Hong Kong stocks falter amid economic and trade concerns

[WORLD] Hong Kong stocks slipped on Monday, pulling back after a six-week rally that had pushed the benchmark index to a two-month high, as investors awaited new market drivers amid signs of economic and corporate headwinds in China. The Hang Seng Index declined 0.6 per cent to 23,471.59 as of 10:45am local time, while the Hang Seng Tech Index lost 0.8 per cent. On the mainland, the CSI 300 Index edged down 0.2 per cent, while the Shanghai Composite Index gained 0.2 per cent.

The retreat in Hong Kong’s market reflects mounting concerns over the global economic outlook. Ongoing trade tensions between the United States and China continue to weigh on sentiment, particularly among export-reliant economies. Investors remain cautious over the potential for renewed escalation, which could trigger further tariffs and exacerbate disruptions across global supply chains.

Among individual stocks, Chinese electric vehicle giant BYD dropped 5.8 per cent to HK$438.60 from a record high, while Li Auto tumbled 4 per cent to HK$109. Meituan slid 5.4 per cent to HK$129.40 ahead of its quarterly earnings release later in the day. Alibaba Group Holding dipped 0.8 per cent to HK$117.90, and Tencent Holdings declined 1.5 per cent to HK$510.50.

The technology sector, a significant growth engine in recent years, is grappling with fresh challenges. Heightened regulatory scrutiny and increasing concerns over data privacy have prompted a more cautious stance among investors. Geopolitical uncertainties have also intensified, with tech giants such as Alibaba and Tencent facing growing oversight both domestically and abroad.

In the auto sector, share price declines underscore broader industry pressures. While the global pivot toward electric vehicles presents vast opportunities, it also brings formidable challenges. Pioneers like BYD and Li Auto are navigating fierce competition and regulatory complexities. The latest sell-off may reflect investor anxiety over market saturation and the continuous innovation required to sustain momentum.

Looking ahead, investors are turning their attention to upcoming corporate earnings reports for clearer signals on market direction. These results are expected to offer critical insights into how companies are managing costs, responding to shifting consumer behavior, and harnessing new technologies to fuel growth. The data will likely play a key role in shaping investor sentiment and guiding future market moves.