HONG KONG, Aug 20 — China and Hong Kong stocks dropped today as recent economic indicators offered little comfort to investors, while a lack of fresh stimulus policies also kept them on the sidelines.
China left its benchmark lending rates unchanged, in line with market expectations. Shrinking interest margins at lenders hampered continued easing efforts after China lowered a string of key interest rates a month earlier.
Turnover remained low in both A-shares and Hong Kong.
Most sectors were down. Coal stocks lost 3.6 per cent, as sluggish mid-year earnings and demand left traders disappointed. Hong Kong-listed mainland property stocks also fell 2 per cent.
Downside risk to China’s growth is rising, and all eyes are on policy, Goldman Sachs economists said in a note.
If the fiscal policy remains restrictive through the remainder of the year, “the various negative forces at play could reinforce each other and growth would slow further,” they added.
China’s bank lending tumbled more than expected in July and hit the lowest in nearly 15 years, according to data released last week. — Reuters
