Fresh Closing Lows For Major Indices

MNI (London) - The major China-related equity indices nudged lower on Wednesday, as markets remain disappointed by the lack of immediate delivery of fresh stimulus, even in the wake of the PBoC’s recent comments surrounding the potential for RRR cuts and more meaningful liquidity injections.

• Note that our Beijing policy team’s most recent piece noted that “Chinese authorities could cut interest rates or banks’ reserve ratio soon and shift investment support to projects that boost demand and support shrinking manufacturing activity weighed down by weak expectations and a persistently soft real-estate sector,” based on their discussions with policy advisors.
• Think-tank estimates of ’24 Chinese GDP growth estimates did the rounds on Wednesday but failed to move the needle in a meaningful manner.
• The CSI 300 was 0.5% lower at the close, while the Hang Seng was 0.6% worse off.
• Both indices registered a fresh closing low for the current cycle.
• Electric vehicle names struggled again, with worry surrounding growth for the sector remaining evident.
• Cosco shipping struggled in the wake of the delivery of its latest profit metrics.
• Sector-/company-specific news provided some upticks elsewhere, but those moves didn’t come in large sectors/names.
• Net northbound HK-China Stock Connect net flow were essentially neutral, with a small bias towards buying (~CNY0.7bn)