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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
CHINA
- Global risk-off environment has left China equities vulnerable in recent weeks despite easing signals (rate cuts + rising ‘liquidity’).
- We saw that the annual change in China liquidity (TSF 12M sum) has rebounded this year after reaching a low of -9tr CNY in December, and has historically been a strong driver of cyclical stocks, particularly tech equities.
- The chart below shows the significant divergence between China tech equities and liquidity (YoY change) since January.
- With officials preparing to hit a pause on its campaign against tech companies, support for liquidity-sensitive sectors could start to rise in the near to medium term.
- In addition, China also announced on Thursday that it will cut the A-share stock transaction fee to 0.01% (of total amount) in Shanghai and Shenzhen stock exchanges (from 0.02%) to boost equities, which are currently ‘cheap’ (using a z-score P/B approach).
- The Hang Seng Index rallied by 4% on Friday after finding support slightly below the 20,000 level this week; ST resistance to watch on the topside stands at 21,689.60 (50DMA), followed by 22,000.
Source: Bloomberg/MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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