CSI 300 Closes Off Lows, But Global Headwinds Weigh On Tuesday

Broader global tones weighed on Chinese equities for most of Tuesday trade, although a turn away from session lows for benchmark mainland indices was seen during the afternoon session.

• The CSI 300 finished 0.4% lower, while HK’s Hang Seng was -1.7%.
• Internals of the monthly Chinese trade balance data were mixed, with softer than expected exports and firmer than expected imports resulting in a narrower than expected trade surplus for October. The release did little for sentiment on net.
• Note that the IMF released its updated Chinese GDP forecasts around the time of the close of mainland equity markets, providing upward revisions on the back of Q3 data and policy support.
• At a more granular level, some insurers struggled after regulators flagged misleading practices amongst some names in the space.
• Chinese EV makers were pressured by a report that Tesla is planning to release a more affordable model targeting European customers.
• Vanke’s early rally (related to well-documented late Monday comments from regulators) more than reversed, with property sub-indices struggling in both China & HK.
• Flow-wise, offshore investors reverted to net selling of mainland equities via the HK-China Stock Connect links, breaking a run of three straight days of net purchases via those channels (which was the longest run of daily net purchases seen since late July/early August). They sold a net CNY4.6bn on Tuesday.