MNI CHINA MARKETS: Yuan Strengthens; Rates Down; Stocks Up

     BEIJING (MNI) - The yuan fell against the U.S. dollar on Friday morning

even though the People's Bank of China set a stronger fixing for the day.

     The yuan was last at 6.5840 against the U.S. unit, weaker than the official

closing price of 6.5823 on Thursday. The yuan opened at 6.5730 on Friday, the

strongest opening rate since Sept. 22, when it stood at 6.5718.  

     The People's Bank of China set the yuan central parity rate against the

U.S. dollar at 6.5810 Friday, much stronger than Thursday's 6.6021. It was the

third straight trading day the PBOC has set the fixing stronger, and today's

fixing was the highest since Oct. 12.

     Money market rates fell as the PBOC injected a net CNY20 billion via

open-market operations for the day. The seven-day repo average was last at

2.8162%, lower than Thursday's average of 2.9040%. The overnight repo average

was at 2.7552%, also lower than Thursday's 2.8122%.

     The yield on benchmark 10-year China government bonds was last at 3.9700%,

down from the previous close of 4.0000%, according to Wind, a financial data

provider. 

     Stocks fell, dragged down by the steel and coal sectors in the morning

session. The benchmark Shanghai Composite Index was 0.45% lower at 3,336.92.

Hong Kong's Hang Seng Index was 0.22% higher at 29,773.66.

--MNI Beijing Bureau; +86 (10) 8532 5998; email: marissa.wang@marketnews.com

--MNI Beijing Bureau; +86 (10) 8532-5998; email: vince.morkri@marketnews.com

[TOPICS: M$A$$$,M$Q$$$,M$$FI$,MN$FI$,MN$FX$]