Hong Kong Stocks: Tariff Tensions Between US and China Persist

Developments in Hong Kong Stocks Amid Tariff Tensions

Hong Kong stocks showcased a modest rise on Monday, reflecting market resilience despite ongoing tariff tensions between the US and China. The Hang Seng Index incrementally climbed by 0.1% to 23,495.17 at 10:05 AM local time, while the Hang Seng Tech Index registered a decline of 0.5%. Prior to this, last Friday marked a notable surge in the indexes, rising 4% and 6.5% respectively, posting their best day since October.

Mainland Market Indicators

On the mainland, the CSI 300 Index and the Shanghai Composite Index experienced a dip of 0.2%. Notable gainers included Trip.com, which surged 4% to HK$533, and Tongcheng Travel Holdings, which advanced 3.6% to HK$19.12. Other significant positive movements were observed in Hua Hong Semiconductor, climbing 2.9% to HK$41.45, and Haier Smart Home, which increased by 2.6% to HK$25.65.

Key Players' Performance

However, the e-commerce giant Alibaba Group Holding, which owns the Post, faced a slight decline of 0.1%, trading at HK$138.40, despite higher-than-anticipated quarterly revenue and profit results. Deutsche Bank responded by raising its target price for Alibaba shares from HK$127 to HK$155, affirming its overall positive sentiment towards mainland China's markets and internet sector.

Drawbacks in the Market

On a more negative note, Wuxi Biologics plummeted by 10.4% to HK$23.30 while Wuxi AppTec fell 9.1% to HK$63.60. Additionally, Lenovo Group recorded a significant drop of 5.2%, settling at HK$12.90.

Insights on Tariff Discussions

Recent discussions between US Treasury Secretary Scott Bessent and Chinese Vice-Premier He Lifeng brought to light serious concerns regarding US tariffs on Chinese goods as articulated by Donald Trump. Trump’s administration took measures to curb Chinese investment in critical technology and energy sectors.

Performance Across Other Markets

The Hang Seng Index emerged as a strong performer in the equity landscape this year, regaining US$423 billion in value, driven primarily by a favorable re-rating of Chinese tech stocks ignited by DeepSeek's AI advancements. Contrastingly, South Korea's Kospi Index dropped 0.6%, while Australia’s S&P/ASX 200 Index remained essentially unchanged. Japanese markets stayed closed for a holiday.