Hong Kong Shares Extend Losses on Oil Shock, PMI Jitters

Hong Kong stocks slipped 124 points, or 0.5%, to 25,941 in early Tuesday trade, marking declines for the second straight session and hovering around a six-week low. Weak U.S. futures weighed on sentiment as surging oil prices—driven by Middle East tensions and Tehran’s threat to shut the Strait of Hormuz—stoked inflation fears. Adding to the bearish momentum, Chinese automakers posted steep February sales drops, reflecting Lunar New Year disruptions. All sectors in the city traded in the red, mirroring a retreat in mainland equities following recent gains, ahead of China’s PMI release that will be due Wednesday. Still, investors held out hope that this week’s parliamentary meeting in Beijing would unveil fresh support measures for the slowing economy. Notable laggards included Zijin Gold Intl. (-6.3%), Laopu Gold (-5.3%), China Hongqiao Group (-3.0%), Xpeng (-2.4%), Cathay Pacific Airways (-2.2%), and ZTO Express (-2.0%).

The Hang Seng slid 571 points, or 2.1%, to close at 26,060 on Monday, erasing prior gains and hitting a six-week low amid broad sector weakness. A sell-off in U.S. futures pressured sentiment as Middle East tensions escalated, with President Trump warning the conflict could last another four weeks and pledging continued strikes until U.S. objectives are met. Risk appetite also faded as Chinese automakers reported sharp sales declines in February, reflecting Lunar New Year disruptions in the world’s largest auto market. Caution also mounted ahead of China’s February PMI and Hong Kong’s January retail sales data later this week. Still, losses were partly offset by strength in mainland stocks on expectations that Beijing may step in to stabilize markets ahead of a key parliamentary meeting. Meanwhile, investors rotated into Chinese energy firms as oil prices surged. Major laggards included Xiaomi (-5.2%), SMIC (-4.7%), Meituan (-4.6%), Cathay Pacific (-4.2%), and Longfor Group (-2.3%).

Hong Kong stocks plunged 667 points, or 2.5%, to 25,958 on the first trading day of March, notching a six-week low and reversing gains from the prior session. Sentiment soured after U.S. futures slumped, following President Donald Trump’s vow to “avenge” the deaths of three service members and continue combat operations in Iran. The renewed conflict heightened fears of oil shipment disruptions through the Strait of Hormuz, a key energy route. Traders also grew cautious ahead of China’s February PMI data. Losses were partly offset by modest gains in mainland shares, as expectations rose that the upcoming National People’s Congress, starting March 4, may unveil fresh support measures for tech, innovation, and domestic consumption. All sectors fell sharply, with declines ranging from 1.9% in consumer stocks to nearly 3% in financials. Notable laggards included SenseTime Group (-7.0%), Xiaomi (-4.0%), Cathay Pacific (-3.6%), Kuaishou Tech. (-3.4%), AIA Group (-3.3%), and SMIC (-3.2%).