Key facts
- China stocks edged up on Tuesday following a pledge of increased policy support.
- The CSI300 Index was flat, and the Shanghai Composite Index gained 0.1% by the lunch break.
- Hong Kong's Hang Seng Index fell 0.6%.
- China's real estate developers led gains onshore, with Vanke shares up nearly 8%.
- AI component makers saw sentiment rebound slightly, with the 5G Communication Index up 0.8% and the STAR50 Index rising 0.6%.
- The Hang Seng Innovative Drug Index rose 3.3%, while tech majors listed in Hong Kong fell 1.4%.
Chinese stocks experienced a slight increase on Tuesday, driven by a commitment from the country's cabinet to enhance counter-cyclical policy support amidst growing economic pressures. However, trading volumes were thin as investors looked ahead to the upcoming week-long National Day holiday. The benchmark CSI300 Index remained largely unchanged by the lunch break, while the Shanghai Composite Index saw a modest gain of 0.1%. In contrast, Hong Kong's stock market declined, with the Hang Seng benchmark down 0.6%.
Real estate developers were among the top performers onshore, with Vanke shares surging nearly 8% following the State Council's pledge to implement measures aimed at stabilizing the property market. Analysts at Goldman Sachs anticipate further policy actions, such as expanding the use of housing provident funds to lower mortgage rates and the introduction of local housing easing measures in more major cities.
Sentiment in the AI component sector showed a slight recovery, with the 5G Communication Index rising 0.8% and the tech-focused STAR50 Index advancing 0.6%. Conversely, rising US Treasury yields and limited liquidity ahead of the holiday period dampened market sentiment, according to analysts at Northeast Securities. They also noted that following recent sharp declines, attractive assets have become more reasonably valued.
The Hang Seng Innovative Drug Index recorded a significant rise of 3.3%, while major technology stocks listed in Hong Kong experienced a decline of 1.4%. Shares of the fast-fashion platform Shein Global Holdings fell to their lowest point since its debut on September 1.
China's National Day holiday is set to begin on Thursday, with onshore trading scheduled to resume on October 8.