Market Commentary - Foreign Markets
China Stocks extend gains on positive data, realty push As on : 17-May-24  15:16

Mainland China share market finished higher for second straight session on Friday, 17 May 2024, thanks to positive industrial production and retail sales data alongwith supportive measures launched by local Chinese governments to shore up the property market.

Vice-Premier He Lifeng called on local governments to purchase idle land and unsold homes from developers and the central bank eased the rules on mortgage loans in the most forceful measures to shore up the property market.

The latest property measures gave additional impetus to stocks, after China removed purchase restrictions in most of the cities in the nation and following speculation that Beijing would scrap a tax dividend on mainland investors that trade the city?s stocks. Expectations of an early rate cut by the Federal Reserve have also brought back Index, foreign inflows.

At close of trade, the benchmark Shanghai Composite index was up 1.01%, or 31.63 points, to 3,154.03. The Shenzhen Composite which tracks stocks on China's second exchange, added 1.18%, or 20.88 points, to 1,785.59. The blue-chip CSI300 index inclined 1.03%, or 37.61 points, to 3,677.97.

ECONOMIC NEWS: China Industrial Production Up 6.7% On Year, Retail Sales Growth Softens--China's industrial growth edged up in April. Industrial production recorded an annual increase of 6.7 percent after rising 4.5 percent in March, the National Bureau of Statistics reported. However, China?s retail sales growth softened to 2.3 percent from 3.1 percent a month ago. During January to April, fixed asset investment rose 4.2 percent from the previous year, following an increase of 4.5 percent in January to March period.

China?s Housing Market Slump Steepens, New Home Prices Down 3.1% On Year--China?s home prices continued to drop in April. New-home prices in 70 cities, excluding state-subsidized housing, fell 0.58% from March, data from National Bureau of Statistics showed Friday. This followed a 0.3% drop in prior reading and a also recorded a 3.1% fall on year on year basis. Values of existing homes also dropped 0.94%.

CURRENCY NEWS: China's yuan edged up against the dollar on Thursday, as firmer mid-point rate fixing by the central bank and reports that China is considering a plan for local governments nationwide to buy millions of unsold homes. Prior to the market's opening, the People's Bank of China set the midpoint rate at 7.1045 per U.S. dollar, weaker than the previous fix 7.102. In the spot market, the onshore yuan opened at 7.2300 per dollar and was changing hands at 7.2267 on Friday, 68 pips weaker than the previous late session close and 1.72% away from the midpoint.

Powered by Capital Market - Live News