MNI China Daily Summary: Thursday, Nov 09

POLICY: China's Consumer Price Index fell by 0.2% in October to mark a three-month low, while the Producer Price Index -- a measure of factory-gate inflation -- dropped further, data from the National Bureau of Statistics.

LIQUIDITY: The People's Bank of China (PBOC) conducted CNY202 billion via 7-day reverse repo, with the rate unchanged at 1.80%. The operation has led to a net injection of CNY8 billion after offsetting the maturity of CNY194 billion reverse repos today, according to Wind Information.

RATES: The seven-day weighted average interbank repo rate for depository institutions (DR007) increased to 1.8367% from 1.8345%, Wind Information showed. The overnight repo average decreased to 1.6477% from 1.7241%.

YUAN: The currency weakened to 7.2850 against the dollar from 7.2756 on Wednesday. The PBOC set the dollar-yuan central parity rate lower at 7.1772 compared with 7.1773 set on Wednesday. The fixing was estimated at 7.2721 by Bloomberg survey today.

BONDS: The yield on 10-year China Government Bonds was last at 2.6875%, up from Wednesday's close of 2.6850%, according to Wind Information.

STOCKS: The Shanghai Composite Index rose 0.03% to 3,053.28 while the CSI300 index increased 0.05% to 3,612.83. The Hang Seng Index was down 0.33% to 17,511.29.

FROM THE PRESS: China Securities Regulatory Commission, the country’s top securities regulator will quicken the development of domestic “smart money” and strengthen supervision of institutions and market behaviour, said CSRC Chairman Yi Huiman at the Financial Street Forum. The CSRC will crack down on illegal fraudulent activities in finance, issuance, and market manipulation. Authorities will improve early warning mechanisms through monitoring market capital leveraging and corporate debt risks, and tracking high-frequency quantitative trading, according to Yi. (Source: Securities Times)

China has huge potential to develop its insurance industry and will continue to optimise regulatory standards for solvency, guide its life insurance industry to reduce debt costs, and reform automobile insurance, according to Li Yunze, director of the State Administration for Financial Supervision. Li, speaking at the Financial Street Forum in Beijing, highlighted strong potential for health, family and property insurance. China will continue to open up in the future and the determination to share development opportunities with the world will not change, Li added. (Source: Securities Daily)

The Shanghai and Shenzhen stock exchanges will tighten refinancing rules aimed at guiding resources towards high-quality companies. The exchanges will restrict refinancing of listed companies whose share price falls below their initial offer price or their net asset value. Meanwhile, listed companies with a relatively high proportion of financial investments must reduce the amount of funds raised through refinancing, and refinancing projects must be closely related to their existing main businesses. (Source: China Securities Journal)