China stocks mixed as economic data in focus; Hong Kong rises

Shanghai and Hong Kong stocks rose on Monday, while China's blue-chip index fell on Monday, as weakness in tech shares outpaced gains in consumer stocks, according to market data. China's July inflation eased, with traders closely monitoring other economic indicators as they debated Beijing's policy direction. The Shanghai Composite Index increased by 0.2% by midday, reaching a three-week high, while Hong Kong's Hang Seng Index climbed 0.7%.

However, the blue-chip CSI300 index saw a decline of 0.5%. China's producer price inflation eased more than anticipated in July, marking its weakest level in three months, while consumer inflation also moderated, as reported on Sunday. This was attributed to a global oil price shock and the AI boom despite the US-Israeli conflict with Iran.

Nomura commented that "China's underlying inflation remains stubbornly subdued, owing to persistent downward pressures from the property bust." Despite expectations of global oil price volatility, Nomura does not anticipate monetary policy easing this year. "Beijing is likely to lean more on fiscal policy measures to stabilize growth," Nomura stated, adding that sustained export strength will limit the extent of policy support.

Analysts believe that July economic data, particularly the lack of broad weakness, could prompt Beijing to introduce fresh stimulus around the end of September. In Hong Kong, the market's movements were driven by consumer and property shares, while chipmakers and AI stocks declined.