CSI 300 Sees Lowest Close Since ‘19

MNI (London) - The CSI 300 shed 0.7% to start the week, registering the lowest closing level since ’19 in the process, although pre-existing YtD intraday lows remain intact.

• Hong Kong’s Hang Seng shed a more pronounced 1.1%.
• The weakness likely triggered after-market comments from the CSRC Chairman, who stressed that regulators will ensure the stable operation of capital markets, along with encouraging the buyback of shares.
• PBoC Governor Pan pointed to a continued desire re: keeping money supply growth in check, along with the want to promote deeper/improved support for key sectors of the economy. Credit quality remains a central part of policymaker deliberations.
• Xinhua covered comments from the head of the National Financial Regulatory Administration. He pointed to the need for a more tailored approach re: provinces handling financial risks.
• Evergrande moved higher in HK trade (adding over 20%), after the company's liquidation hearing was pushed back to late January. Onshore media also flagged further meetings between banks and developers in recent weeks.
• Still, the CSI 300 and Hang Seng property sub-indices were lower on the day, after PBoC Governor Pan reiterated the idea that housing is for living in, not speculation.
• In the background we saw China criticise the U.S. after a U.S. warship sailed through disputed waters in the South China Sea. That is a marginal negative.
• On a micro level, one pharmaceutical name shed 25%, with trade in the name halted. The move came on the back of negative guidance.
• Flows via the HK-China Stock Connect schemes were a marginal negative (CNY1.4bn) to start the week.