Shares of Chinese companies operating duty-free stores jumped on expectation that pricing of their goods may become more competitive than mainstream retailers after sweeping tariffs.
China Tourism Group Duty Free Corp. shares rose as much as 28 percent in Hong Kong, the most since Sept. 30. On the mainland, Hainan Haiqi Transportation Group Co., which announced plans to buy the entire stake in Hainan Provincial Duty Free, and Wangfujing Group Co., surged by the 10 percent daily limit.
âDuty-free may benefit from channel shift, theoretically,â Morgan Stanley analysts including Hildy Ling wrote in a note. âThis may take place if there are price hikes at other retail channels because of higher tariffs.â
President Donald Trumpâs so-called reciprocal tariffs have come into effect, with duties imposed on China going as high as 104 percent. While thereâs potential for a prolonged trade war between the worldâs two largest economies, Morgan Stanleyâs analysts said actual exposure of duty-free retailers to US imports should be low.
By Bloomberg News
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