Chinese stocks post first annual gain since 2020, HK ends 4-year rout By Reuters

By Jiaxing Li

Hong Kong (Reuters) – Chinese language shares registered their first annual achieve following an unprecedented three-year decline regardless of a dip on the ultimate buying and selling day of 2024, whereas Hong Kong shares ended the 12 months increased, supported by optimism over coverage help.

The blue-chip CSI 300, monitoring the most important corporations listed in Shanghai and Shenzhen, rose 14.7% this 12 months, breaking a dropping streak since 2021 set off by the COVID-19 pandemic, property sector woes and weak client confidence.

The gained 12.8% in 2024, ending a two-year decline. Hong Kong’s benchmark closed the 12 months’s last session up 0.1%, for an annual achieve of 17.7% that ended 4 consecutive years of losses.

“Inside the equities markets, China’s efficiency got here as a constructive shock to many buyers,” analysts at Worth Companions stated in a word this week.

“Numerous supportive measures introduced through the second half of the 12 months, which focused financial coverage, the property market, and capital markets, largely surpassed expectations and overshadowed ongoing financial issues,” the analysts stated.Chinese language authorities have applied a number of the boldest measures since September, together with rate of interest cuts, residence buy incentives and funding schemes for inventory shopping for, to bolster the struggling economic system and restore home confidence.

Stabilising the capital market has develop into a coverage requirement, and the overall consensus is that the market is bottoming out, China Asset Administration stated in a word.

With an advance of 34.7%, banking shares led the onshore market positive factors this 12 months, because the 4 largest state banks reached multi-year highs.

The chip sector surged 53.9% as home buyers boosted holdings in native semiconductor makers amid tightening U.S. chip restrictions.

Nevertheless, mainland shares weakened on the 12 months’s last buying and selling day, with the CSI benchmark falling 1.6% after knowledge confirmed China’s manufacturing facility exercise grew at a slower tempo in December amid rising commerce dangers.

The market is within the last section of “coverage expectation-driven” buying and selling, following Chinese language leaders’ key conferences this month, Dai Qing, a strategist at Changjiang Securities, stated in a word.

Looking forward to 2025, dividend-paying shares may nonetheless outperform the broader market within the brief time period, particularly when U.S. President-elect Donald Trump’s January inauguration could carry market disruptions, he added.