MNI China Daily Summary: Tuesday, October 27

LIQUIDITY: The People's Bank of China (PBOC) injected CNY100 billion via 7-day reverse repos with the rate unchanged. This resulted in a net injection of CNY30 billion after the maturity of CNY70 billion of reverse repos, according to Wind Information. The operation aims to keep liquidity reasonable and ample, the PBOC said on its website.

RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) increased to 2.5307% from 2.2548% on Monday, Wind Information showed. The overnight repo average rose to 2.4230% from the previous 2.2157%.

YUAN: The currency weakened to 6.7157 against the dollar from 6.6690 on Monday. The PBOC set the dollar-yuan central parity rate higher for a third trading day at 6.6989, compared with the 6.6725 set on Monday.

BONDS: The yield on the 10-year China Government Bond was last at 3.1575%, down from the close of 3.1890% on Monday, according to Wind Information.

STOCKS: The Shanghai Composite Index rose 0.10% to 3,254.32, while the CSI300 index edged up 0.17% to 4,699.28. Hang Seng Index lost 0.53% to 24,787.19.

FROM THE PRESS: China should always put financial security first and prevent systemic risks such as excessive borrowing by local governments, asset price bubbles, and any rapid rise in leverage ratios, the 21st Business Herald reported in an editorial. China's financial opening and financial innovations should always avoid finance becoming a capital game rather than serving the real economy, wrote the Herald. China should beware of the risks financial speculation poses to manufacturing and potential crisis underneath financial bubbles, the Herald said.

China has made technological development and the upgrading of industry the focus of its next stage of growth as it seeks to diversify from reliance on labor-intensive industries and tourism, the Global Times commented in an editorial. Suppression by the U.S., particularly against China's technology industry, is the biggest threat, although the U.S. has been weakened by the pandemic, the newspaper said. China has also set a goal of building a first-class military to protect its national interests and to counter U.S. hostility, the Times said. The editorial was published during the Oct. 26-29 Fifth Plenary Session of the Communist Party, where delegates meet to discuss the country's "14th Five-Year Plan" and long-term goals through to 2035.

China is considering designated areas such as 5G technology, integrated circuits, and biomedicine as special planning projects under the 14th Five-Year Plan (2021-2025) to promote breakthroughs and acquire leadership in core technologies, reported the China Securities Journal citing the Ministry of Industry and Information Technology. China will strive for breakthroughs in computer chips, 5G applications, IoT, and driverless transportation, the Journal reported citing Zhongtai Securities.