Rally For Developers Limits Benchmark Index Losses

Mainland Chinese equities finished lower at the benchmark index level on Wednesday, albeit closing off lows (CSI 300 -0.2%).

• Property developers were supported by a front-page commentary piece in the Securities Times, suggesting that the country should drop home-buying restrictions in regions other than top-tier cities with the ‘hottest’ property markets.
• BBG’s gauge tracking Chinese property developers surged on the news, adding nearly 10% on the day, closing at the highest level since early August.
• Still, this wasn’t enough to push the broader CSI 300 index higher come close, with last Monday’s property stimulus-induced highs remaining unchallenged (the fact that the article didn’t push for a further reduction of property purchase restrictions in top-tier cities probably provided a limiting factor for broader indices).
• Recent comments from Premier Li stressed that China is on target to achieve its annual GDP growth target of “around 5%.”
• Northbound flows the HK-China Stock Connect schemes were essentially flat in net terms on Wednesday.