Chinese stocks drop
The stocks in Mainland China had an unfavorable time in the early afternoon, along with other
Asia Pacific markets also moving towards the negative territory as U.S.-China tensions
worsened, as reported by CNBC.
In mainland China, the Shanghai composite dropped 2.25%, while the Shenzhen composite fell
nearly 3%. The Shenzhen component declined 3.45%.
Meanwhile in Hong Kong, the Hang Seng index plunged 2%. Tech stocks tumbled down across
the board, with Tencent dropping 4.67% and Alibaba slipping 2.43%. Gaming stocks also
witnessed steep losses.
Tensions between U.S. and China caught attention this week. China announced on Friday that it
ordered the United States to cease its consulate in Chengdu, in response to the U.S. demanding
the closure of the Chinese consulate in Houston. In the past few days, analysts had predicted
that China would be closing a U.S. consulate in retaliation, and also, listed likely targets.
“For now, US-China conflict risks are poised to reinforce pre-existing negative bias in the Asia
session, derived from 1.2%-1.3% drop in Wall St that had predated Pompeo’s remarks,” Mizuho
Bank’s Vishnu Varathan, head of economics and strategy, stated in a note.