HONG KONG TENSION BETWEEN CHINA, US HITS STOCKS

China is set to impose new national security legislation on Hong Kong after last year’s pro-democracy unrest, a Chinese official said on Thursday, drawing a warning from President Donald Trump that Washington would react “very strongly” against the attempt to gain more control over the former British colony.
 
The U.S. State Department also warned China, saying a high-degree of autonomy and respect for human rights were key to preserving the territory’s special status in U.S. law, which has helped it maintain its position as a world financial centre.

China’s action could spark fresh protests in Hong Kong, which enjoys many freedoms not allowed on the mainland, after often violent demonstrations of 2019 plunged the city into its deepest turmoil since it returned to Beijing’s rule in 1997.

Trump, who has ratcheted up his anti-China rhetoric as he seeks re-election in November, told reporters “nobody knows yet” the details of China’s plan. “If it happens we’ll address that issue very strongly,” he said.
 
Stocks in Asia Pacific fell on Friday as rising tensions between the U.S. and China weighed on investor sentiment.

Hong Kong’s Hang Seng index led losses among the region’s major markets as it plummeted 5.56% to close at 22,930.14.

 
 
 
Source: CNBC & Reuters