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Luo Huining, Head of China’s Liaison Office in Hong Kong, said in a statement on Saturday, “the unscrupulous intentions of the US politicians to support the anti-China chaos in Hong Kong have been revealed, and their clowning actions are really ridiculous.”

Additional quotes

“Intimidation and threats cannot frighten the Chinese people.”

“US sanctions on him indicated he was doing what he “should be doing for my country and Hong Kong.”

Meanwhile, a Hong Kong government spokesman said:  The sanctions were “shameless and despicable” and represented “blatant and barbaric” interference in China’s internal affairs.

“We will not be intimidated,” he said.

Separately, a spokesman for Hong Kong’s Securities and Futures Commission, financial markets watchdog, noted: “Many global firms have prior experience of properly assessing and responding to specific US sanctions to the extent they may affect any of their clients and related activities.”

The responses come in from Hong Kong and China after the US imposed sanctions on Hong Kong Chief Executive Carrie Lam and other top officials, accusing them of playing a hand in curtailing political freedoms in HK.

Market implications

Friday’s risk-off market mood could very well extend into weekly Asian opening on Monday, as concerns over the US-China escalation will remain in play ahead of the trade talks scheduled between the two countries next Saturday, August 15.  

The US dollar will extend its recovery momentum across the board while the US stock futures could come under heavy selling pressure.

The US dollar index settled Friday at 93.40, adding 0.65% on a daily basis while the S&P 500 futures closed modestly flat around 3350 levels. Meanwhile, Gold corrected sharply to finish at $2035.