Hong Kong stocks slumped 705 points, or 2.7%, to 25,058 in early Monday trading, erasing gains from the previous session as U.S. futures retreated and regional markets weakened amid inflationary pressures from surging oil prices. The jump in energy costs intensified worries about higher living expenses and the prospect of interest rate hikes worldwide.
On the geopolitical front, Iran appointed Mojtaba Khamenei as Supreme Leader following the death of his father, signaling that hardliners remain firmly in control one week into its conflict with the U.S. and Israel. The move was condemned by President Trump as “unacceptable.”
In China, equities fell more than 1%, snapping a two-day winning streak, as ongoing producer price deflation highlighted subdued demand. Traders largely dismissed CPI data showing consumer inflation at a three-year high of 1.3%, buoyed by Lunar New Year travel and holiday spending.
Losses in Hong Kong were broad-based, with declines led by MMG Ltd (-7.5%), Swire Properties (-7.1%), Sun Hung Kai Properties (-6.7%), Cathay Pacific (-6.6%), and AIA Group (-5.7%).
