Another Day Of Modest Losses, Outflows Persist, Property Steps Ignored

The CSI 300 shed 0.6% on Thursday

• Official PMI data prints for August were mixed, with the manufacturing release not quite as contractionary as expected (rate of contraction slowed vs. July), while the rate of expansion in the non-manufacturing PMI eased slowed more than expected.
• Any bid surrounding the data was quickly sold into, with the benchmark index going out just above worst levels.
• Wednesday’s news of 2 mega cities easing mortgage rules didn’t aid sentiment today. A quick reminder that weekend commentary in the SCMP suggested that Shanghai was unlikely to relax restrictions in a meaningful way.
• It is also worth noting that the Shenzhen Stock Exchange aims to keep property developers’ access to capital market financing stable, per CSJ sources, although this news also did little for the space.
• Widely watched property developer metrics moved lower, erasing the bulk of the gains seen over previous sessions.
• Elsewhere, policymaker rhetoric continues to focus on increased support for the private economy.
• Mainland equities experienced another round of net outflows via the HK-China Stock Connect, seeing ~CNY4.3bn of net outflows on the session (with net outflows totalling CNY89.7bn in August).