Indices Bounce From Lows After Holiday Data & Geopolitics Weighed

The mainland’s return from the Golden Week holiday period initially saw Chinese equities look lower on the back of domestic travel and spending figures that disappointed vs. pre-holiday expectations (the data wasn’t outright soft, with ’19 levels in both metrics surpassed).

• Disappointing high frequency home sales data (property developers struggled) and the broader risk-off tone surrounding the weekend events in Israel will also have weighed.
• That saw the CSI 300 over 1% lower at one point.
• Indices then bounced as the day wore on.
• Suggestions that increased international travel may have skewed the domestic economic data surrounding the holiday were noted.
• While the holiday data fed into the narrative that the economy may have bottomed, along with facilitating calls for further policy stimulus.
• The HSCEI recovered to close higher on the day, with firmer oil prices helping energy names.
• The CSI 300 briefly showed in positive territory late in the day, before moving back below unchanged to close -0.1%.
• Flow-wise, the northbound legs of the China-HK Stock Connect schemes saw net sales of CNY7.5bn, extending the pre-holiday trend.
• CPI, trade balance & money supply/credit data provide the highlights of the domestic docket this week.