SHANGHAI: Mainland China and Hong Kong stocks slipped on Friday, mirroring losses across regional markets, as investors rushed toward safe-haven assets in response to Israeli strikes on Iran that escalated tensions in the Middle East.
Israel launched strikes against Iran on Friday, saying it targeted nuclear facilities, ballistic missile factories and military commanders during the start of a prolonged operation to prevent Tehran from building an atomic weapon.
** At the close, the Shanghai Composite index ended 0.75% lower at 3,377.00 points, while the blue-chip CSI300 index dropped 0.72% to 3,864.18 points.
** The smaller Shenzhen index ended down 1.32% and the start-up board ChiNext Composite index was weaker by 1.13%.
** In Hong Kong, the benchmark Hang Seng index dropped 0.59% to 23,892.56 points, while the Hang Seng China Enterprises index fell 0.85% to 8,655.33 points.
** However, the risk-off sentiment lifted gold and miners’ shares, with key performers including Western Region Gold Co , Shandong Gold Mining Co, and Zhongjin Gold Corp all closing more than 2% higher.
** China’s defense sub-index closed up 1.7%.
** Oil and gas shares were another outperformer, with a sub-index jumping 2.02%.
** Safe-haven demand for the U.S. dollar also pressured the yuan, with the onshore spot price weakening 0.14% to 7.1815 per dollar around 0800 GMT.
* Major Chinese stock indexes appeared poised for a weekly decline, despite the recent trade truce between Washington and Beijing easing the risk of further tariff escalation in the near term.
** “While geopolitical tensions (between the United States and China) may have temporarily deescalated, China’s macroeconomic outlook remains fragile,“ BCA Research said in a note.
“As a result, without a decisive policy boost, Chinese equities lack any catalyst to trend higher.”
** Both the SSEC and CSI300 indexes fell 0.25% for the week, booking their third weekly loss in four weeks.
