FX.co ★ Hang Seng Hits 2-Week Low But Books Third Monthly Gain

The Hang Seng Index fell by 404 points, or 1.6%, to close at 24,773 on Thursday, marking its third consecutive decline and the lowest close in a fortnight. Investor sentiment took a hit following the release of China's official Purchasing Managers' Index (PMI), which revealed the slowest growth in services activity in eight months and the steepest drop in factory output in six months. This decline is attributed to escalating trade barriers and adverse weather conditions. Concurrently, the imminent expiration of U.S. President Trump’s suspension of “reciprocal” tariffs looms, with only eight trade agreements secured in the last 120 days. On the monetary policy front, Federal Reserve Chair Jerome Powell dismissed expectations for an interest rate cut in September, maintaining the rates unchanged for the fifth consecutive meeting. The downturn was widespread, impacting sectors such as property, consumer goods, and financial stocks. Noteworthy declines were observed in companies such as Laopu Gold (-9.2%), Meituan (-4.7%), Pop Mart International (-4.5%), and China Overseas Land (-4.2%). Despite these losses, the index still recorded a 2.9% increase in July, marking its third monthly gain, supported by optimism over the extension of the U.S.-China tariff pause and Beijing’s pro-growth policies.