Hong Kong Stocks Tumble on China Crackdown Worries: Live Business Updates


Hong Kong Stocks Tumble on China Crackdown Worries: Live Business Updates

Losses were significantly greater than in other global markets. Hong Kong’s property companies were among the biggest decliners.

European markets opened down 1 percent to 2 percent, following drops in stocks in China, Taiwan and South Korea. Futures markets were forecasting that Wall Street would open about 1 percent lower later on Friday.

Other markets signaled skittishness as well, as U.S. Treasury bond prices rose and oil futures fell.

The losses came amid concerns about the future of Hong Kong, a Chinese city that operates under its own laws and has its own independent judicial system. China’s announcement signaled a potential curtailment of that status and could ignite protests like the ones that roiled the city’s streets last year and sent stocks tumbling over the summer.

The sell-off also came after China announced its plans to increase government deficit spending to help combat the economic effects of the coronavirus. Officials on Friday said that Beijing would increase the deficit this year to “above 3.6 percent” to prop up the economy, and would spend another $140 billion in the stimulus effort. While significant, that plan falls short in proportional terms of what other governments around the world have earmarked to fight the outbreak-related global economic crisis.

Chinese officials declined to set an economic growth target for this year and outlined plans to ramp up government spending, as they continue to look for ways to recover from the economic toll of the coronavirus.

In his annual report to Chinese lawmakers on Friday, Premier Li Keqiang said the country’s leaders had declined to set a target for the first time in years “because our country will face some factors that are difficult to predict in its development due to the great uncertainty regarding the Covid-19 pandemic and the world economic and trade environment.”

China’s economy shrank in the first three months of the year compared with a year earlier, the first decline in the modern era, after efforts to fight the outbreak froze vast parts of its industrial machine.

China’s growth target represents a gauge of how the country’s leaders see the economy faring, and its official figures — which most economists consider to be too smooth and steady to be precisely accurate — generally meet or exceed the goal. In recent years, the targets have declined as China’s economy slowed, and it has offered a range instead of a specific figure to give policymakers more flexibility. Last year, it set a growth target of 6 percent to 6.5 percent.

Mr. Li’s report said China would ramp up government spending by $140 billion to stir growth, plus issue a similar amount on bonds for coronavirus recovery efforts. While significant, the spending represents about 2 percent of China’s annual economic output, a smaller proportion compared with what other countries have done.

Stocks on Wall Street fell on Thursday, pulling back after major benchmarks had rallied the day before.

The S&P 500 fell less than 1 percent, and global benchmarks were also lower. It’s been a turbulent week for markets, with shares alternating between gains and losses each day so far as investors assessed new economic developments and the prospect of businesses reopening their doors to customers.

On Thursday, data on jobless claims from the Labor Department showed that the surge of layoffs had reached more than 38 million in nine weeks.

But economic data from Europe provided more optimism. A monthly flood of European purchasing managers’ index reports showed business activity slowly picking up: The eurozone manufacturing index came in at 39.5 points, higher than expected and up from 33.4 last month, while the services index rose to 28.7, from 12.0 last month.

Facebook will allow many of its employees to work from home permanently, Mark Zuckerberg, Facebook’s chief executive, announced during a staff meeting that was live-streamed on his Facebook page.

The social media giant sent its employees home in March as the coronavirus began to spread in the United States. Mr. Zuckerberg said that the temporary changes caused by the virus spurred the company to re-evaluate its requirement that employees work in a shared office. Within a decade, he said, as many as half of the company’s more than 45,000 employees would work from home.

Facebook will begin by allowing new hires who are senior engineers to work remotely, and then allow current employees to apply for permission to work from home if they have positive performance reviews.


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