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Trouble in China Pushes Hong Kong’s Hang Seng Into Bear Market



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Stocks in Hong Kong entered a bear market on Friday, down 21 percent from their high near the start of the year, as investors around the world grew increasingly worried that the deteriorating condition of China’s real estate sector could spill over into the broader economy.The slump in the Hang Seng Index, which is made up mostly of companies from the mainland, comes as China’s economy confronts weakening growth. After three years of harsh Covid restrictions, foreign investment is down, consumers are spending less and the housing market is in turmoil.Bear markets, when stocks drop at least 20 percent from their most recent peak, are a relatively rare signal that investors view the economy with serious pessimism. The Hang Seng fell just over 2 percent on Friday, and about 6 percent for the week. The index is down more than 10 percent so far this month.Global investors are also wary of the effects of China’s weakening economy, which has added to worries about inflation and high interest rates in Europe and the United States. On Friday, European stocks were down throughout the day and the S&P 500 lost about half a percent in early trading. The U.S. benchmark index is on track to record its third consecutive weekly decline.“Markets are being hit by the perfect storm,” analysts at Barclays wrote in a report on Friday, citing rising interest rat …

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