[HONG KONG] Hong Kong shares fell on Wednesday (Apr 16), dragged by technology stocks, after the US restricted Nvidia chip sales to China, raising concerns of an intensifying trade war.
Meanwhile, Chinese shares rose marginally following better-than-expected economic growth data and on reports that state-backed investors bought shares in the afternoon session.
The Hang Seng index closed down 1.9 per cent, snapping a six-day winning streak. The Hang Seng China Enterprises index fell 2.6 per cent, while Hong Kong-listed tech shares lost 3.7 per cent.
On the other hand, China’s blue-chip CSI 300 Index and the Shanghai Composite Index closed 0.3 per cent higher after trading in the red for most of the day.
China’s first-quarter economic growth beat expectations, underpinned by solid consumption and industrial output, even as policymakers braced for the impact of US tariffs.
China unexpectedly appointed a new trade negotiator key in any talks to resolve the escalating tariff war with the US
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State-backed “National Team” investors may have bought A-shares in afternoon trading as trading volume spiked in some exchange traded funds tracking major benchmarks, local media reported.
Nvidia said on Tuesday that the US government limited exports of its H20 artificial intelligence chip to China, a key market for one of its most popular chips.
“The latest tariff headlines – targeting Boeing, critical minerals, and now Nvidia – underscore the deepening strategic decoupling,” said Charu Chanana, chief investment strategist at Saxo.
Reports that the US is using tariff negotiations to push allies to limit China’s economic role added more uncertainties and weighed on sentiment, she said.
Nvidia supply chain companies Foxconn Industrial Internet and Zhongji Innolight dropped 3.3 per cent and 2.7 per cent respectively. Apple supply chain stocks also fell broadly.
However, stocks with chip self-sufficiency theme such as Naura rose 3.5 per cent.
“The damage from the trade war will show up in the macro data next month,” said Zhiwei Zhang, chief economist at Pinpoint Asset Management, when commenting the first-quarter economic growth data.
“The uncertainty is extremely high for corporates and investors,” he added.
Nomura cut its annual China GDP growth forecast to 4 per cent from 4.5 per cent, citing tariff headwinds.
The smaller Shenzhen index ended down 1.1 per cent and the start-up board ChiNext Composite index was weaker by 1.206 per cent. REUTERS
