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Chinese stocks and the yuan are trading.......>

CHINA
CHINA: Chinese stocks and the yuan are trading near daily highs with mainland
indices adding almost 1% after recovering early weakness and the Hang Seng back
to flat on the day. The recovery of the 3200 level on the SCI300 together with
the Chinext's break above its 55-dma make a strong case for a bullish reversal.
- The initial recovery on rumours of state banks buying the yuan has been
further supported by SCMP headlines about China's top trade envoy heading to the
US. 
- USDCNH is now down ~0.32% on the day, erasing all of yesterday's gains to
trade at 6.9458. Rate markets have surprisingly remained unaffected by the
headlines, even after Premier Li commented that China will avoid a flood of
stimulus. 2-year swaps last down 2bps on the day at 2.86%, decoupling from
stocks and the yuan. 

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