FX.co ★ Hong Kong Equities Under Pressure

Hong Kong's stock market saw a decline of 257 points or 1.1% to 23,963 in Thursday's morning session, as it reversed the previous day's gains. This downturn was primarily attributed to weaker-than-expected economic data from China. A private report indicated that China's services sector experienced its smallest growth in nine months during June. Market sentiment was further dampened by investor caution ahead of a crucial U.S. employment report expected later in the day, alongside persistent uncertainties regarding the approval of a U.S. tax reduction and spending bill. Moreover, concerns loomed with the approaching July 9 tariff deadline, following President Trump's decision not to extend the tariff pause. U.S. futures also saw slight declines after both the S&P 500 and Nasdaq reached new record highs overnight amid President Trump's recent trade agreement with Vietnam. However, some losses in Hong Kong were limited due to encouraging domestic data, which showed a 1.9% year-over-year increase in retail sales for May, marking an end to 14 months of continuous decline. Investors are now focusing on China's upcoming Politburo meeting, where additional economic stimulus measures could potentially be revealed. Leading the decline were Huishang Bank (-8.6%), Kingsoft (-5.7%), Xiaomi (-3.0%), and Alibaba Health (-2.4%).