Little Changed To End The Week

Chinese & HK benchmarks stuck to relatively contained ranges ahead of the weekend, with the CSI 300 adding 0.1% and the Hang Seng shedding -0.1% come the close.

• Both measures dealt either side of flat during the session.
• House price data and yesterday’s after-market communique from the CSRC had little lasting impact in net index terms, although property developers benefitted from a slighter slower fall in the latest national new house price readings.
• Local news wires ran analyst views outlining expectations for the PBoC to maintain liquidity at a “reasonably sufficient” level via OMOs, in line with recent central bank rhetoric.
• Elsewhere, analysts suggested that shares of most Chinese state-owned enterprises offer high dividends and stable profits, presenting decent investment opportunities.
• Conversely, hedge fund Banxia warned against overweighting small caps, citing familiar risks.
• After hours we saw familiar themes from regulators e.g. the CSRC cracking down on market manipulation/insider trading and the PBoC being focused on corruption in the finance industry.
• Participants remain hungry for fresh policy and market-specific support.
• Net Northbound HK-China Stock Connect flows were essentially flat on the day, with a very modest bias to selling.