By George Glover
Chinese stocks returned from their weeklong vacation with an almighty hangover, as a vague briefing caused investors to worry about how serious Beijing is in its commitment to revive stagnant growth.
While the flagship Shanghai Composite Index spiked more than 8% at the start of trading on Tuesday, likely due to pent-up demand from the Golden Week holiday, it later gave up much of those gains and finished the session up just 4.6%.
Hong Kong's Hang Seng Index, which unlike the Shanghai gauge has been open for trading the past week, tumbled 9.4%.
Some of China's best-known stocks were also in the red.
Hong Kong-listed shares in the e-commerce giant Alibaba dropped 8.8%, and its American depositary receipts were down 8.7% in premarket trading. Hong Kong shares in its rival JD.com plunged 12%, and its ADRs cratered 11.6% ahead of the U.S. opening bell.
ADRs for EV maker NIO were down 12%, and U.S. listed shares in video-sharing website Bilibili plunged 16% in the premarket. Shares in IT and artificial intelligence company Baidu, tech conglomerate Tencent, and Temu parent PDD Holdings also plummeted.
A briefing by China's top economic planning agency sparked the selloff, which comes after a sharp rally in China's benchmark indexes.
The National Development and Reform Commission pledged to bring a 100 billion yuan ($14.2 billion) spending package forward to this year. Chairman Zheng Shanjie said he would take steps to support growth, but stopped short of outlining a specific stimulus package.
The lack of clarity disappointed investors who've been hoping that Beijing will roll out a "bazooka" set of measures in a bid to jump-start faltering growth.
It wasn't just Chinese stocks feeling the pain on Tuesday. Shares in some of Europe's top luxury companies, for whom the world's second-largest economy is a key market, also tumbled.
LVMH Moët Hennessy Louis Vuitton dropped 4.8%, Gucci parent Kering slumped 7%, and handbag designer Hermès International fell 3% in morning trading.
Write to George Glover at george.glover@dowjones.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
October 08, 2024 05:42 ET (09:42 GMT)
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