Rally In Financials Drives Afternoon Bid In China

Mainland Chinese & Hong Kong equities firmed notably during the second half of Monday’s session.

• Financials were touted as the driver of the move, with Chinese media outlets flagging news that an upcoming Shanghai Stock Exchange seminar that will touch on boosting the valuation of the country’s financial sector.
• That left the CSI 300 +1.6% better off at the close, with the Hang Seng up a similar amount in late dealing.
• Elsewhere, wires pointed to a social media post from the wife of a well-known fund manager, who outlined hopes for market stabilisation led by fresh gains in SOEs.
• Meanwhile, TenCent outperformed the broader tech sector for much of the day ahead of the company’s quarterly earnings report (due Wednesday).
• When it comes to cross-border flows, the Northbound legs of the Hong Kong-China Stock Connect schemes extended the recent run of (relatively contained) net daily inflows, with ~CNY4.1bn of net purchases registered via those channels on Monday.