Getty ImagesA stock market rally in China has stalled after a long-awaited announcement about plans to boost the country’s ailing economy disappointed investors.
Shares had risen more than 10% when trading resumed after Golden Week, but fell after a press conference by the country’s economic planners.
After a volatile trading day, mainland China’s Shanghai Composite Index closed 4.6% higher, while Hong Kong’s Hang Seng fell 9.4%.
Investors had hoped for more information on how the government plans to support economic growth, but the announcement provided few details.
The chairman of China’s National Development and Reform Commission, Zheng Shanjie, said he is “fully confident” the country will achieve its economic and social goals for the year.
But he added: “Downward pressure on the Chinese economy is also increasing.”
Mr Zheng’s comments came as he announced that China will spend 200 billion yuan ($28 billion; £21.5 billion) on spending and investment projects by the end of this year.
“The market actually expected more. The correction will be even stronger if Golden Week data in terms of consumption is weak,” said Alicia Garcia-Herrero, chief economist for the Asia-Pacific region at investment bank Natixis.
“The market is reacting to the lack of real fiscal stimulus. I would not have organized a press conference to announce nothing new.”
China’s government has sought to boost confidence in the world’s second-largest economy as concerns grow that it will miss its own 5% annual growth target.
Since then, investors have been flocking to Chinese stocks officials began rolling out a series of measures aimed at boosting the economy.
The plans include aid for the country’s crisis-hit real estate sector, support for the stock market, cash benefits for the poor and more government spending.
But some economists question whether the policies will be enough to solve China’s economic problems.
They say deep reforms may be needed to put the country on a more sustainable growth path.
Growth in the world’s second-largest economy is slowing as it continues to face a real estate market slump, falling prices and other challenges.