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China Equities Outperform As Tighter Market Supervision Is Expected

ASIA STOCKS
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Hong Kong and China equity markets are mixed today, with China mainland equities rallying. The move higher could be linked to China vowing to tighten stock market supervision after the rebound in equities has stalled, which was announced late Friday afternoon while the CSI300 have now broken back above the 20, 50 & 100-day EMA. Earlier the 1yr MLF was kept on hold at 2.50%.

  • Hong Kong equities are lower today with HSTech down 0.88% after being down as much as 2.34% at one stage, Mainland Property Index is down 0.95%, the HSI is down 0.56%, the HS China Enterprise which tracks China owned companies is faring slightly better down just 0.23%. In China, equity markets are higher, with the CSI300 up about 2.10%, while the CSI1000 is down 0.53%
  • China Northbound saw -7.4b of inflows on Friday, with the 5-day average at -2.29billion, while the 20-day average sits at 0.24billion yuan.
  • (Bloomberg) China Vows to Tighten Stock Market Supervision as Rebound Stalls - (See link)
  • In the property space, China Vanke is reassuring investors by outlining plans to address liquidity pressure and operational challenges, emphasizing the use of its own resources and existing financing facilities to stabilize operations and reduce debt. Despite recent stock and bond declines following credit rating downgrades, Vanke's executives deny rumors and controversies, affirming their commitment to timely project completion and normal overseas business activities, while facing pressures from China's real estate crisis and upcoming debt maturities.
  • China's steel exports surged in March to the highest level since 2016, driven by weakened domestic demand amid the country's property crisis, prompting traders to seek more profitable markets. This trend underscores concerns raised by US Treasury Secretary Janet Yellen about Chinese overcapacity across emerging industries, with steel exports helping to offset declining domestic demand and affecting global steel markets.
  • Efforts by the US to persuade the Netherlands and Japan to further restrict Chinese access to semiconductor technology faced resistance this week, as both countries sought more time to assess existing limits and awaited the outcome of the US presidential election. The impasse highlights the uncertainty surrounding President Joe Biden's reelection prospects and his administration's attempts to hinder China's technological advancement, particularly in light of potential policy shifts depending on the election outcome.
  • Looking ahead, New Home Prices, GDP, Industrial Production & Retail Sales all expected tomorrow.
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Hong Kong and China equity markets are mixed today, with China mainland equities rallying. The move higher could be linked to China vowing to tighten stock market supervision after the rebound in equities has stalled, which was announced late Friday afternoon while the CSI300 have now broken back above the 20, 50 & 100-day EMA. Earlier the 1yr MLF was kept on hold at 2.50%.

  • Hong Kong equities are lower today with HSTech down 0.88% after being down as much as 2.34% at one stage, Mainland Property Index is down 0.95%, the HSI is down 0.56%, the HS China Enterprise which tracks China owned companies is faring slightly better down just 0.23%. In China, equity markets are higher, with the CSI300 up about 2.10%, while the CSI1000 is down 0.53%
  • China Northbound saw -7.4b of inflows on Friday, with the 5-day average at -2.29billion, while the 20-day average sits at 0.24billion yuan.
  • (Bloomberg) China Vows to Tighten Stock Market Supervision as Rebound Stalls - (See link)
  • In the property space, China Vanke is reassuring investors by outlining plans to address liquidity pressure and operational challenges, emphasizing the use of its own resources and existing financing facilities to stabilize operations and reduce debt. Despite recent stock and bond declines following credit rating downgrades, Vanke's executives deny rumors and controversies, affirming their commitment to timely project completion and normal overseas business activities, while facing pressures from China's real estate crisis and upcoming debt maturities.
  • China's steel exports surged in March to the highest level since 2016, driven by weakened domestic demand amid the country's property crisis, prompting traders to seek more profitable markets. This trend underscores concerns raised by US Treasury Secretary Janet Yellen about Chinese overcapacity across emerging industries, with steel exports helping to offset declining domestic demand and affecting global steel markets.
  • Efforts by the US to persuade the Netherlands and Japan to further restrict Chinese access to semiconductor technology faced resistance this week, as both countries sought more time to assess existing limits and awaited the outcome of the US presidential election. The impasse highlights the uncertainty surrounding President Joe Biden's reelection prospects and his administration's attempts to hinder China's technological advancement, particularly in light of potential policy shifts depending on the election outcome.
  • Looking ahead, New Home Prices, GDP, Industrial Production & Retail Sales all expected tomorrow.