The Hang Seng Index in Hong Kong fell over 2% due to a decline in the consumer cyclicals sector. E-commerce giant JD.com recorded the biggest losses, with its shares slumping as much as 12%. Other companies such as Chow Tai Fook Jewelry, Haidilao, and Zhongsheng Group also experienced significant drops in their stock prices. This decline also affected other index heavyweights, including Baidu, Alibaba, and Meituan.
China’s consumer prices remained flat in September, falling below expectations. The consumer price index saw no annual growth, which was lower than the predicted 0.2% increase. The producer price index also fell, declining by 2.5% from the previous year, weaker than economists had anticipated. These tepid prices indicate a sluggish economic recovery for China after the COVID-19 restrictions were lifted.
JD.com’s shares slumped to their lowest point in a year due to concerns of weaker retail growth. The company saw a decrease in its market capitalization, and several brokers downgraded JD.com and revised its target price. Morgan Stanley changed its rating from overweight to equal weight, while Jeffries reduced its price target for JD.com’s Nasdaq listing.
In September, China reported a smaller-than-expected decline in exports compared to the previous year, while imports fell slightly more than predicted. Exports dropped by 6.2%, while imports also fell by the same percentage in US dollar terms. This decline in exports has been consistent since May, while imports last showed positive growth in September of the previous year.
