China stocks fall as COVID-19 concerns weigh on sentiment – Reuters

SHANGHAI, Nov 26 (Reuters) – China stocks fell on Friday as domestic COVID-19 cases and a new and possibly vaccine-resistant coronavirus variant weighed on investor sentiment, with semiconductor-related and energy shares leading the drop.

The CSI300 index (.CSI300) fell 0.6% to 4,865.00 by the end of the morning session, while the Shanghai Composite Index (.SSEC) lost 0.5% to 3,566.18.

The Hang Seng index (.HSI) dropped 2.1% to 24,213.55. The Hong Kong China Enterprises Index (.HSCE) lost 2.1% to 8,626.31.

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** For the week, the CSI300 index has shed 0.5%, while the Hang Seng Index lost 3.3%. Hong Kong stocks set to post their biggest weekly decline in 10.

** A handful of local COVID-19 cases in eastern parts of China have prompted Shanghai city to limit tourism activities and a nearby city to cut public transportation services. read more

** That sent tourism stocks (.CSI930633) and consumer staples (.CSICS) down 1.6% and 0.6%, respectively.

** Meanwhile, the real estate sub-index (.CSI000952), the energy sub-index (.CSIEN), the semiconductor sub-index (.CSIH30184) dropped between 1.3% and 2.8%.

** In the global market, the detection of a new and possibly vaccine-resistant coronavirus variant in South Africa spooked investors, pushing them to dump risk assets and flock to safe havens. read more

** Refinitiv data showed outflows of more than 1 billion yuan through the Northbound legs of the Stock Connect programme (.NQUOTA.ZK), (.NQUOTA.SH), showing overseas investors were net sellers of A-shares.

** Morgan Stanley said it continues to prefer A-shares in the China space and will wait for a better entry point.

** “Recent remarks around a policy easing stance and an A-share structural inflow catalyst are positive, but pressure lingers on the earnings front and consensus’ estimates reduction could last for longer,” Morgan Stanley said in a note.

** Hong Kong shares tracked global markets lower as the new COVID-19 variant weighed on sentiment.

** Tech giants (.HSTECH) tumbled 2.6%, with Tencent Holdings (0700.HK), Meituan (3690.HK), and Alibaba Group (9988.HK) down between 3% and 4%.

** The Wall Street Journal reported on Thursday that some Chinese state-run companies were restricting employees’ use of Tencent’s messaging app Weixin, citing security concerns.

** Gambling stocks (.CSICESG10) slumped 4.5%.

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Reporting by Shanghai Newsroom; Editing by Subhranshu Sahu

Our Standards: The Thomson Reuters Trust Principles.

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