Around the world, economies are pulling themselves out of the gutter. But Hong Kong, and its related ETF, may find itself stuck without a strong helping hand. It’s not all doom and gloom, however.
On the minus side:
- Hong Kong’s jobless rate increased 0.1% from May to reach 5.4% in June, which is making it harder for the government to revive growth, reports Sophie Leung for Bloomberg. The city has injected $11.3 billion, or 5.2% of GDP, to help the stumbling economy.
- GDP diminished a seasonally adjusted 4.3% in the 1st quarter from the previous three months, and the final numbers for the second quarter may not be as severe as the 7.8% decline in the first quarter year-over-year.
- Bankruptcy petitions in Hong Kong climbed 89% in June to 1,619 year-over-year.
But in better news:
- Financial Secretary John Tsang says export demand is improving and that is what contributed to the smaller decline in the economy for the second quarter.
- The Financial Secretary previously projected a 6.5% contraction for 2009 after a significant decrease in demand for Chinese goods shipped through the city.
- The Hong Kong Hang Seng Index climbed 60% from the March 9 low on hopes that worldwide stimulus plans would revive the city’s growth, writes Nipa Piboontanasawat and Kevin Hamlin for Bloomberg.
- Home sales also increased 19.3% this year.
- iShares MSCI Hong Kong Index (EWH): up 42.3% year-to-date
Max Chen contributed to this article.