CHINA MARKETS: Yuan Stronger; Rates Down; Stocks Rise

     BEIJING (MNI) - The yuan rose against the U.S. dollar Friday morning after

the People's Bank of China set a stronger daily fixing. 

     The yuan was last at 6.4545 against the U.S. unit, compared with the

official closing price of 6.4972 on Thursday. The yuan has strengthened 6.5%

since touching 6.9040 on May 10. 

     The PBOC set the yuan central parity rate against the U.S. dollar at 6.5032

on Friday, stronger than Thursday's 6.5269. The PBOC has set the fixing stronger

for 10 straight trading days, and today's fixing was the highest since May 12

last year.

     Money market rates fell Friday morning after the PBOC skipped injecting

liquidity via open-market operations, which resulted in zero injection/drain.

The seven-day repo average was last at 2.7671% on Friday, lower than Thursday's

average of 2.8241%. The overnight repo average was at 2.5938%, lower than

Thursday's 2.6116%.

     The yield on benchmark 10-year China government bonds was last at 3.5806%,

down from the previous close of 3.5858%, according to Wind, a financial data

provider. 

     Stocks were up, led higher by the ferrous metal mining and non-ferrous

mining sectors. The benchmark Shanghai Composite Index was last up 0.39% at

3,378.59. Hong Kong's Hang Seng Index was 0.53% higher at 27,667.50.

--MNI Beijing Bureau; +86 (10) 8532-5998; email: iris.ouyang@marketnews.com

--MNI Beijing Bureau; +86 (10) 8532-5998; email: vince.morkri@marketnews.com

[TOPICS: M$A$$$,M$Q$$$,M$$FI$,MN$FI$,MN$FX$]