Modest Losses Across The Board

(MNI) London - Most of the major China-linked indices and sub-metrics finished lower on Monday. The CSI 300 shed 0.4% and the Hang Seng lost 1.0%. The former registered fresh multi-year intraday and closing lows.

• Disappointment surrounding Friday’s RTRS source piece re: the likelihood of continued Chinese fiscal prudence (at least in headline budget deficit/GDP terms) was a negative.
• Elsewhere, continued worry re: familiar economic risks did the rounds, which also factored in.
• On that front, our Beijing policy team’s latest insight piece noted that “China’s refreshed public-private partnership (PPP) regime will help stem the flow of falling private investment in 2024 by encouraging more active private-sector ownership of user-paid infrastructure and utilities, while curbing the growth of local government implicit debts.”
• Elsewhere, state-backed media flagged an uptick in early repayment surrounding LGFV debt, as issuers look to move to lower interest rate level debt.
• Headlines surrounding EV battery demand and related moves lower in lithium futures pricing seemed to weigh on battery/lithium names.
• M&A activity in the securities sector continued to boost related names in that sphere.
• After the close, a RTRS headline noted that the China's dealers' association will probe China Development Bank on suspected activities to influence market prices of securities.
• HK-China Stock Connect links generated modest net inflows (CNY2.7bn) for mainland equities.