China Stocks Still Down Despite Fresh Developer Support

Aggregate China/HK indices are struggling again, despite fresh support measures for the real estate developer segment. US futures are slightly up at this stage, but have been range bound for much of the session as the market processes the mid-term election results. A Republican controlled House, but Democrat controlled Senate is now a potential outcome (see this link for more details).

• The CSI 300 is off 0.75% at this stage, the Shanghai Composite -0.35%. China headline inflation data came in softer than expected, underscoring a weak domestic demand backdrop. Coupled with a further lockdown for part of Guangzhou and rising covid case numbers, has dented sentiment.
• Property related stocks have done better, the Shanghai composite sub-index up 2.3%. Onshore media stated that the financing backdrop for developers is improving, while a funding program, available to developers, along with other private firms, was boosted to 250bn yuan.
• The HSI is down around 1.5% at this stage, with the underlying tech sub-index off 2.26%.
• The Kospi (+1%) and Taiex (+1.75%) are faring better, aided by Samsung and TSMC gains. Offshore tech gains have continued to impress in the first part of this week. The Nikkei 225 has been a laggard though, -0.50%.
• The ASX 200 is +0.60% at this stage, with mining names the main drivers.