Hong Kong’s benchmark Hang Seng Index lost over 1.9% in opening trade to hit 2011 lows after the U.S. Federal Reserve raised interest rates by 0.75% and indicated they could be hit as high as 4.6% next year.
That dented stocks of U.S.-listed Chinese EV makers, whose business prospects depend a lot on interest rates.
|Alibaba Group Holding Ltd. BABA||-3.13%|
|JD.com Inc JD||-3.3%|
|Baidu Inc BIDU||-3.55%|
|Tencent Holdings Ltd. TCEHY||-1.3%|
|Nio Inc NIO||-8.86%|
|XPeng Inc XPEV||-13.86%|
|Li Auto Inc LI||-6.26%|
XPeng shares nosedived 13% at the open, while Nio shed over 8%. Li Auto shares lost over 6%. Higher interest rates mean buying cars would take more money out of a consumer’s pocket in terms of monthly installments.
The Bank of Japan is set to announce its policy decision today.
Also Read: Fed Raises Rates 0.75% For Third Straight Time: ‘We Will Keep At It Until We’re Confident The Job Is Done’
Goldman Sachs Group Inc. GS has sharply reduced its 2023 economic growth forecast for China, forecasting that gross domestic product will likely rise 4.5% in 2023, which is down from a previous projection of 5.3%, reported Bloomberg citing a note written by Goldman’s economists.
Taiwan’s government has said it will never permit China to “meddle” in its future after a Chinese government spokesperson said Beijing was willing to make the utmost effort to strive for a peaceful “reunification” with the island, reported Reuters.
Company News: China’s leading online travel service provider Trip.com Group Limited TCOM reported a second-quarter profit of RMB 43 million ($6 million) compared to a net loss of RMB 659 million ($93.5 million) a year earlier
China Evergrande Group EGRNF said on Wednesday it was mulling transferring some assets to its property unit in order to settle some of the unit’s debt payments, reported Reuters.
Top Gainers and Losers: WuXi Biologics (Cayman) Inc. and Galaxy Entertainment Group Limited were the top losers among the Hang Seng constituents, having shed over 3.5%. There were no gainers on Thursday.
Global News: U.S. futures traded in the red on Thursday morning Asia session. The Dow Jones futures were down 0.7% while the Nasdaq futures lost 1.21%. The S&P 500 futures shed 0.93%.
Elsewhere in Asia, Australia’s ASX 200 remained closed on Thursday. Japan’s Nikkei 225 was down 1.16% while China’s Shanghai Composite index lost 0.15%. South Korea’s Kospi was down 1.49%.
Image and article originally from www.benzinga.com. Read the original article here.