BEIJING: Hong Kong fell the most in a week as slower-than-forecast inflation increased concern demand is weakening in the world’s second-biggest economy.
The Hang Seng China Enterprises Index slid 1.4 percent to 10,356.32 at 10:46 a.m., dragged down by power producers and banks. China Minsheng Banking Corp. declined 1.8 percent in Hong Kong, halting a five-day rally. The Shanghai Composite Index erased losses and was little changed as brokerages extended gains. Citic Securities Co. jumped 3.4 percent.
President Xi Jinping’s government is struggling to keep economic growth on track even after cutting the main interest rate six times in the last year. The consumer-price index rose 1.3 percent in October, official data on Tuesday showed, compared with the 1.5 percent median estimate in a Bloomberg survey. The producer-price index fell 5.9 percent, extending its streak of negative readings to 44 months. Exports declined for a fourth straight month in October, while factory gauges signal the nation’s manufacturing still hasn’t bottomed out amid faltering global demand.
“There is a bit of a pullback after the recent rally with the CPI not helping,” said Gerry Alfonso, a trader at Shenwan Hongyuan Group Co. in Shanghai. “The low CPI figure is an indication that domestic consumption is perhaps a bit weaker than expected and that can create concerns. Banks are under-performing as the rally in recent days was very significant and investors are cashing in.”
