China rally loses steam as authorities disappoint markets; Hong Kong stocks plunge more than 6%
A customer watches stock market at a stock exchange in Hangzhou, China, on September 27, 2024.
Costfoto | Nurphoto | Getty Images
SINGAPORE — The rally in Chinese markets lost steam on Tuesday after a briefing from the country’s National Development and Reform Commission provided few details on further stimulus.
While mainland China’s CSI 300 skyrocketed over 10% at the open Tuesday in its return from the Golden Week holiday, the index pared gains to a 3.8% rise later in the session.
Hong Kong’s Hang Seng index briefly plummeted over 10%, before recovering slightly to a smaller loss of 7.6%.
Other Asia-Pacific markets mostly fell on Tuesday, with investors watching August pay and spending data out from Japan.
Household spending in Japan fell 1.9% year-on-year in August in real terms, a softer fall compared to the 2.6% decline expected by a Reuters poll of economists.
The drop is the fastest pace of decline since January, which saw a 6.3% fall year-on-year. That decline also came before spring wage negotiations delivered the largest pay hikes to unionized Japanese workers in 33 years.
However, real wages rose in August, with data from the country’s statistics bureau indicating that wages climbed 2% to an average of 574,334 yen ($3,877.44).
Overnight in the U.S., stocks slid as rising oil prices and higher Treasury yields weighed on market sentiment.
The Dow Jones Industrial Average dropped 0.94%, while the S&P 500 slid 0.96%. The Nasdaq Composite saw the largest loss, falling 1.18%.
The benchmark 10-year Treasury yield rose to 4.02%, marking the first time since August that the yield topped 4%.
Oil prices also rose as tensions in the Middle East remain high. U.S. crude climbed more than 3% to settle above $77 per barrel.
— CNBC’s Lisa Kailai Han and Jesse Pound contributed to this report.
