The Hang Seng Index in Hong Kong fell over 2% due to a decline in the consumer cyclicals sector. JD.com, an e-commerce giant, experienced a slump of 12% and reached its lowest point in a year. Other stocks such as Chow Tai Fook Jewelry, Haidilao, and Zhongsheng Group also contributed to the index’s losses. Additionally, heavyweights like Baidu, Alibaba, and Meituan were also in the red. China Merchants Bank, Ping An Insurance, and HSBC Holdings also experienced declines.
China’s consumer prices remained flat in September, falling below expectations. The consumer price index did not see any growth on an annual basis, which was lower than the estimated 0.2% increase. The country’s producer price index also fell by 2.5%, weaker than economists’ expectations of a 2.4% decline. These tepid prices highlight the challenges of China’s economic recovery after the lifting of Covid restrictions.
JD.com’s shares reached their lowest point in a year due to downgrades and target price revisions. Analysts at Morgan Stanley downgraded JD.com, while Jeffries lowered its price target for the company on the expectation of weaker retail growth. JD.com’s market capitalization has halved since the beginning of the year. These factors contributed to the 12.1% decline in the company’s shares.
In September, China reported a smaller-than-expected decline in both exports and imports. Exports fell by 6.2% compared to a year ago, which was less than the 7.6% drop forecasted. Similarly, imports fell by 6.2%, slightly more than the 6% decline expected. China has experienced a decline in exports every month since May, while the last positive print for imports was in September of the previous year.
