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China, Hong Kong stocks slump on signs of slowing economic growth


Asia-Pacific stocks slid on Monday amid concerns over the state of the US-China relationship following the arrest of a Chinese telecoms executive and as data showed further signs of slowing growth in the world’s second-largest economy.

Concerns over US-China relations were stoked last week by the arrest of Huawei chief financial officer Meng Wanzhou while she was in transit in Vancouver following a US extradition request. 

Over the weekend, China summoned the US ambassador to Beijing to demand the cancellation of the arrest warrant for Ms Meng.

In Hong Kong the Hang Seng index fell 1.4 per cent to a near three-week intraday low, dragged down by a 1.4 per cent fall for tech stocks and a 1.7 per cent decline for financials.

Losses in China built as the day wore on, where the CSI 300 index of Shanghai- and Shenzhen-listed stocks was down 1.2 per cent. 

Figures released over the weekend in China showed November consumer price growth slowed to 2.2 per cent year on year from 2.5 per cent in the previous month, undershooting forecasts. Export growth also slowed to 5.4 per cent year on year growth from 15.6 per cent in October.

Julian Evans-Pritchard, senior economist, Capital Economics, said the data pointed to a “a downbeat picture of an economy that is losing momentum”. 

“Economic activity looks set to weaken further in the coming months as slowing credit growth continues to weigh on domestic demand and cooling global growth weighs on exports, even if a renewed escalation in trade tensions is avoided,” he added.

Japan’s Topix slid 1.9 per cent to a six-week low as the technology sector sank 2.4 per cent and industrials fell 2 per cent. Those losses also followed a revised estimate of Japan’s gross domestic product for the third quarter that showed the economy shrank 2.5 per cent, worse than the median forecast of a 1.9 per cent contraction from economists polled by Reuters.

In Australia, the S&P/ASX 200 slipped 2.1 per cent to a two-year low.



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