Chinese stocks rise on higher-than-expected cut in borrowing rates

Chinese stocks rose on Friday after Chinese banks cut the benchmark mortgage benchmark rate by a surprisingly wide margin, to revive the struggling housing sector and support a slowing economy hit by severe coronavirus outbreaks. COVID-19. The CSI300 index rose 1.4% to 4,056.03 at the end of the morning session, while the Shanghai Composite Index gained 1.1% to 3,131.40.

The Hang Seng index gained 1.8% to 20,489.63 points. China’s Hong Kong Enterprise Index gained 2.1% to 7,046.06. ** So far this week, the CSI300 index is up 1.7%; the Hang Seng index added nearly 3% and is eyeing the biggest weekly gain in two months.

** The five-year loan prime rate (LPR) was cut by 15 basis points to 4.45% from 4.60%, while the one-year LPR remained unchanged at 3.70%. **The move “suggests they are concerned about accumulating risk in the housing sector,” said Carlos Casanova, senior Asia economist at Union Bancaire Privée in Hong Kong.

** “There will likely be more rate cuts to come in the coming months,” said Zhiwei Zhang, chief economist at Pinpoint Asset Management. “I also expect more policy measures on tax, real estate and the platform economy.” **Shanghai reported three new cases of COVID-19 outside quarantine areas on Thursday, ending five days without any such cases.

** Overseas investors were net buyers of A-shares, with Refinitiv data showing inflows of more than 8.3 billion yuan ($1.24 billion) via Stock Connect at the lunch break. , ** Property developers fell 1.3% on the rate cut, after jumping 2.3% in the previous session.

** Coal miners jumped 4.2%, transportation companies climbed 3.4%, while healthcare and consumer staples stocks rose 1.7% each. ** US President Joe Biden could speak with his Chinese counterpart Xi Jinping in the coming weeks, National Security Adviser Jake Sullivan said Thursday.

**Hong Kong-listed tech giants jumped 3.5%, with index heavyweights Tencent, Meituan and Alibaba up 2.3% to 3.5%.

(This story has not been edited by the Devdiscourse team and is auto-generated from a syndicated feed.)

Garland K. Long