The Hang Seng plunged 437 points, or 2.2%, to close at 19,623 in the first trading session of 2025, pressured by further selling in mainland markets following sluggish Chinese factory activity in December.
The index fell to a near one-month low, with concerns growing over potential tariff hikes by the Trump administration and their broad impact on Chinese exports.
Nervous traders anticipated that markets would lack clear direction until the National People's Congress in early March when Beijing is due to announce its growth targets for the new year. Losses were broad, with financials down about 3%.
A surge in U.S. futures capped further losses, with bets that Wall Street could maintain the momentum that has propelled it to two straight years of strong gains in 2024. Sun Art shares plunged 20% after Alibaba Group agreed to sell its majority stake in the retailer.
Sharp losses were also seen in Semicon Manufacturing (-9.0%), Citic Ltd. (-5.3%), Sunny Optical Tech (-4.6%), and Wuxi Biologics (-4.4%).
Source: Trading Economics
