CHINA MARKETS: Yuan Stronger; Rates lower; Stocks Up

     BEIJING (MNI) - The yuan reversed course and was stronger against the U.S.

dollar late Monday morning, despite  the People's Bank of China setting a weaker

fixing rate for the day.

     The yuan was last at 6.6338 against the U.S. unit, compared with the

official closing price of 6.6470 on September 29, the last trading day before

holiday.  The yuan had opened weaker but strengthened later in the morning. 

     The PBOC set the yuan central parity rate at 6.6493, 0.19% weaker than that

of 6.6369 on September 29.

     Money market rates were lower Monday morning. The seven-day repo average

was last at 2.8814%, compared with 3.1622% on September 30, the last trading day

for banks. The overnight repo average was at 2.6730%, compared with 2.9518% on

September 30.

     The PBOC drained a net of CNY180 billion in liquidity via its open market

operations Monday.

     The yield on benchmark 10-year China government bonds was last at 3.5739%,

compared with a previous close of 3.5901%.

     Stocks rallied, with the household appliances and liquor sectors leading

gains. The benchmark Shanghai Composite Index was last up 1.18% at 3,389.11.

Hong Kong's Hang Seng Index was 0.25% lower at 28,387.05.

--MNI Beijing Bureau; +86 10 85325998; email: he.wei@marketnews.com

--MNI BEIJING Bureau; +1 202-371-2121; email: john.carter@mni-news.com

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