HK & China Equities Mixed, Yuan Continues Its Slide

Hong Kong & China equities are mixed today while ranges reman tight. China loosened its grip on the yuan, trading near its lowest against the dollar since November, while the outlook for exports is set to improve. The yuan remains close to the weak end of its daily trading band, reflecting a cautious stance amid broader regional market movements.

• Hong Kong equities are mixed today as investors keep their eye on the release of key US data at the end of the week. The wider HSI is 0.10% lower, while the HSTech Index is 0.20% higher, property Indices are mixed with the Mainland Property Index up 0.37% and the HS Property Index little changed.
• Chinese stocks opened lower, influenced by the Fed’s cautious stance on interest rates. The yuan is trading near its weakest level against the dollar since November, but there is optimism about the improvement in China’s export outlook. Beijing's more constructive approach to real estate is expected to bolster domestic confidence. HSBC maintains an overweight position on Chinese stocks, predicting that they could benefit from policy adjustments aimed at stimulating growth. The CSI 300 is 0.30% lower, the small-cap indices CSI 1000 is 0.15% higher, the CSI 2000 is 0.27% higher, the CSI 300 Real Estate Index is 2% lower while the ChiNext is unchanged.
• Property space, Shimao Group Holdings Ltd is set to defend against a creditor's liquidation demand in Hong Kong court, a crucial moment in its ongoing debt struggles, following a winding-up petition by China Construction Bank over a HK$1.6 billion obligation. The outcome hinges on Shimao's progress in debt negotiations, including lowering the conversion price for convertible bonds, amidst broader industry turmoil and other liquidation hearings this week. China’s Ministry of Natural Resources is exploring ways to support local governments in buying back unused land with special bonds to help real estate companies reduce debt and promote more efficient land use.
• OpenAI is taking steps to block access to its AI tools in unsupported regions, including China, starting in July, amidst growing US pressure to restrict Chinese access to advanced AI technology. This move follows the company's actions against covert influence operations and aligns with broader US efforts to limit China's development of critical technologies.
• Looking ahead, calendar is empty this week