Hong Kong stocks ended lower Monday as the U.S. government shutdown weighed on investor sentiment, prompting a rush to safe-haven assets including gold, while private sector growth in the city softened.

The Hang Seng Index fell by 183.15 points, or 0.67%, to 26,957.77, while the Hang Seng China Enterprises Index decreased 84.96 points, or 0.88%, to 9,573.38.

Hong Kong markets will be closed Tuesday on account of a public holiday.

Hong Kong's private sector activity expanded for a second straight month in September, though growth momentum softened amid a sharper drop in export demand, S&P Global said Monday.

The S&P Global Hong Kong SAR Purchasing Managers' Index fell slightly to 50.4 from 50.7 in August, signaling a modest improvement in overall business conditions.

Meanwhile, the US government shutdown continued, leading to the cancellation of key economic data, including Friday's nonfarm payrolls report.

In corporate news, Xuanzhu Biopharmaceutical (HKG:2575) launched its initial public offering in Hong Kong.

The biopharmaceutical company is offering up to 67,333,500 shares, expected to be priced at HK$11.60 apiece, to raise HK$701 million in net proceeds for the R&D and commercialization of the company's core products

Meanwhile, China Carbon Neutral Development (HKG:1372) posted a loss attributable to owners of HK$7.5 million for the year ended June 30, narrowing significantly from a HK$132.8 million loss for the 18-month period ended June 30, 2024.

Shares of the carbon solutions company were down over 3%.