Equities

Global stocks risk off as Beijing considers new Hong Kong security law

Shares in Hong Kong plunged overnight on fears a tougher stance from Beijing’s towards the territory will spark fresh pro-democracy protests, potentially leading to the kind of wide scale unrest witnessed last year.

The Hang Seng slid over 5%, notching its worst daily decline in 5 years, as China’s National People’s Congress (NPC) moved to impose controversial national security legislation in Hong Kong, bypassing local lawmakers.

Markets unsettled as China plans new Hong Kong security law

China’s Communist Party wants to impose a national security law that would ban “treason, secession, sedition and subversion”.

The plan was detailed at the NPC on Friday, triggering fears that Beijing will end freedoms for people in Hong Kong not enjoyed elsewhere in China. As well as big losses for the Hang Seng, European and US stock market futures fell deep into the red ahead of the European open.

Carrie Lam, the pro-Beijing chief executive of Hong Kong, says the territory will fully cooperate with China.

Beijing’s Hong Kong plans send stocks tumbling – but why now?

Under terms of the handover from the British in 1997, Hong Kong is required to pass national security laws but has so far not done so.

Hong Kong’s first chief executive Tung Chee-hwa tried and failed to pass national security laws in 2003, sparking protests that ultimately ended in his resignation.

Lately Chinese officials have become worried it lose its grip on Hong Kong with new elections due in September.

Last November pro-democracy candidates won handily in district council elections, raising fears in Beijing that this would be replicated in Legco elections this autumn.

This followed several months of unrest and civil disobedience against a planned extradition bill – later abandoned – which caused Hong Kong’s economy to tank and local stocks to tumble.

How Hong Kong-Beijing tensions could impact global stock markets

This is a significant flash point that will stir local protests and anger the US.

Unrest last year caused Hong Kong to fall into recession for the first time in ten years, with GDP contracting 3.2% in the July-September quarter as tourists steered clear of the territory.

The unrest also caused business sentiment to sour – a repeat would be an unwelcome development for the likes of Asia-focused banks HSBC and Standard Chartered.

Investors will need to add renewed Hong Kong-Beijing tensions into their mix of geopolitical risks, and it is the way it fits into the broader US-China rivalry that is more of a worry for investors.

Equities face new geopolitical risks as China-US relations sour further

At a time of already strained relations between China and the West, this decision will only isolate Beijing even more.

US President Donald Trump he would “address that issue very strongly” if Beijing passed the law. The White House has already started to stiffen its resolve against China for what it sees as the country’s failure to contain the Covid-19 outbreak.

Republican and Democratic Senators plan to introduce legislation to impose sanctions on Chinese officials if the law is passed.

Meanwhile US-China trade tensions remain on the table and with the US presidential election this November coming at a time of immense economic dislocation, the relationship between Washington and Beijing looks set to only get worse.

Últimas noticias sobre los mercados

OPEC meeting weighs on crude oil ahead of US EIA inventories data

Read More

Stocks grind higher, dollar squeeze continues

Read More

IPO market coming back to life?

Read More

OPEC meeting preview: record production cut to be extended?

Read More

Stocks nudge up, GBP breaks higher

Read More

May’s top Blends: Einhorn rises, Corona falls

Read More

Stocks rally, dollar offered, OPEC meeting may be brought forward

Read More

Week Ahead: Central banks on tap, NFP faces massive Covid hit

Read More

ECB preview: Welcome to Japan?

Read More
Previous
Next

Regístrese en Markets.com para probar Marketsx

Markets.com es la avanzada plataforma para operar proporcionada por Markets.com. Como parte de TradeTech Group, empresa subsidiaria de Playtech, miembro del índice FTSE 250, tenemos amplios conocimientos de los mercados financieros y una amplia oferta de recursos disponibles para seguir elevando el nivel en el mundo de las operaciones financieras.

Crear cuenta

CySEC (Europa)

  • Los fondos de los clientes se conservan en cuentas bancarias separadas
  • Programa de Indemnización (FSCS) de hasta 20.000 EUR
  • Protección de saldo negativo

Productos

  • Las operaciones con pares de divisas y CFD conllevan un gran riesgo de sufrir pérdidas
  • Gestión de acciones
  • Quantranks

Markets.com está administrada por Safecap Investments Limited. Autorizada por la CySEC con número de licencia 092/08 y por la FSCA con número de licencia 43906.

FSC (RESTO DEL MUNDO)

  • Los fondos de los clientes se conservan en cuentas bancarias separadas
  • Verificación electrónica
  • Protección de saldo negativo

Productos

  • Las operaciones con pares de divisas y CFD conllevan un gran riesgo de sufrir pérdidas
  • Creador de estrategias

Markets.com, administrada por Tradetech Markets (Australia) Pty Ltd («TTMAU”) Regulada por la Comisión de Servicios Financieros («FSC») de las Islas Vírgenes Británicas con número de licencia SIBA/L/14/1067.

FCA (Reino Unido)

  • Los fondos de los clientes se conservan en cuentas bancarias separadas
  • Programa de Indemnizaci&oacute;n para los Inversores (ICF) de hasta 85.000 GBP<br>* en función e los criterios y la idoneidad
  • Protección de saldo negativo

Productos

  • Las operaciones con pares de divisas y CFD conllevan un gran riesgo de sufrir pérdidas
  • Cotizaciones de spread
  • Creador de estrategias

Markets.com, administrada por TradeTech Alpha Limited (“TTA”) Regulada por la Autoridad de Conducta Financiera («FCA») con n&uacute;mero de licencia 607305.

ASIC (Australia)

  • Los fondos de los clientes se conservan en cuentas bancarias separadas
  • Verificación electrónica
  • Protección de saldo negativo

Productos

  • Las operaciones con pares de divisas y CFD conllevan un gran riesgo de sufrir pérdidas

Markets.com, administrada por Tradetech Markets (Australia) Pty Ltd («TTMAU”) Tiene el número de Licencia de Servicios Financieros Australianos 424008 y está autorizada para prestar servicios financieros por la comisión del Mercado de Valores de Australia («ASIC”).

FSCA (Africa)

  • Los fondos de los clientes se conservan en cuentas bancarias separadas
  • Protección de saldo negativo

Productos

  • Las operaciones con pares de divisas y CFD conllevan un gran riesgo de sufrir pérdidas
  • Creador de estrategias

Markets.com, administrada por TradeTech Markets (Sudáfrica) (Pty) Limited («TTMSA”) Autorizada por la Junta de Servicios Financieros de Sudáfrica («FSCA») con número de licencia 46860.

Al seleccionar uno de estos reguladores, se mostrará la información correspondiente en todo el sitio web. Para obtener más información, haga clic aquí.