Hang Seng Plunges—Are Markets Afraid of Hormuz?
Hong Kong stocks plunged sharply in early March, with the main index plummeting 667 points (-2.5%) to 25,958, hitting a six-week low and averaging the previous session's gain.
Sentiment worsened after Wall Street futures weakened, fueling renewed geopolitical concerns. The market assessed that the escalating US-Iran conflict was increasing the risk of global threats, prompting investors to reduce risky assets.
The biggest concern came from the energy sector: the market feared disruptions to oil shipments through the Strait of Hormuz, a vital global energy route. This risk made market participants increasingly defensive, especially since oil prices had fluctuated wildly at the opening of the week.
At the same time, investors also held back ahead of the release of China's February PMI, which often sets the tone for sentiment in Asian assets.
Pressure in Hong Kong was somewhat resilient, as mainland Chinese stocks did not fall as sharply. Market expectations began to shift toward the agenda of the Second Session/National People's Congress, which will begin around March 4, with expectations of new support for technology, innovation, and domestic consumption.
Sector-wise, all sectors weakened: consumer stocks fell around 1.9%, while financials fell nearly -3%. The biggest laggards included SenseTime (-7.0%), Xiaomi (-4.0%), Cathay Pacific (-3.6%), Kuaishou (-3.4%), AIA (-3.3%), and SMIC (-3.2%). (asd)
Source: Newsmaker.id
