Chinese companies listed in Shanghai and Hong Kong had their profit estimates cut the most among major Asian economies as the slowest growth in more than two decades erodes corporate earnings.
Projections for earnings of companies in the Shanghai Composite Index in the next 12 months were lowered by 6.8 percent, while those for firms in Hong Kong’s Hang Seng China Enterprises Index, or the H-share gauge, were reduced by 6.2 percent, according to data compiled by Bloomberg.
Demand for materials from cement to steel has been waning in China as the nation seeks to reduce pollution, while relying more on consumption and services as major drivers of growth. The world’s second-largest economy grew 6.9 percent last year, the weakest expansion since 1990.
Resource companies saw the biggest profit cuts in Shanghai, led by Yanzhou Coal Mining Co. and Wuhan Iron & Steel Co., while Cnooc Ltd., PetroChina Co. and Lenovo Group Ltd. were among the companies that had their forecasts cut the most in Hong Kong, the data showed. PetroChina, the nation’s biggest oil producer, said Thursday profit slid to the lowest since 1999 amid tumbling oil prices.
— With assistance by Abhishek Vishnoi, and Shidong Zhang