China’s fixed-asset investment (FAI) increased 10.2 percent in the January-October period compared with the year-earlier period, in line with expectations, slightly coming down from the 10.3 percent gain recorded in the January-September period.
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However China’s A-share market remains overwhelmingly retail-investor and sentiment driven and as such will continue to be volatile. Despite the hope of a potential turnaround in property sector and better fiscal support for infrastructure in the fourth quarter, the trade data suggest investment momentum probably has yet to pick up.
“It seems unlikely that the HSI will drop below 21,000, while it is also hard to break the 23,000 level”, he said. The headline unemployment rate declined to 5.0 percent, declining even as the civilian labor force increased by 313,000.
China stocks closed up on Monday, as investors welcomed Friday evening’s announcement by the securities regulator that initial public offerings (IPOs) would resume in the next several weeks.
This month, the iShares China Large Cap ETF (FXI) and the iShares MSCI China ETF (MCHI) rose 1.8% and 2.1%, but the Deutsche X-Trackers Harvest CSI 300 China A-Shares Fund (ASHR) and the Market Vectors ChiNext Fund (CNXT) jumped 7% and 7.5%. FAI is called higher by 10.2 percent, easing from 10.3 percent a month earlier. But scores of institutional investors, who originally track China through Hong Kong stocks, have shifted 30 to 40 percent of their capital to A-shares. The euro strengthened 0.1 percent to $1.0738 after sliding as much as 0.7 percent last session to its lowest price since April 23.
The benchmark Hang Seng Index traded between 22,324.41 and 22,479.46. Japan’s Nikkei and South Korean shares were little changed.
Among other laggards, heavyweight components SoftBank (Tokyo Stock Exchange: 9984.T-JP) lost 1.1 percent and brokerages such as Nomura Holdings (Tokyo Stock Exchange: 8604.T-JP) and Daiwa Securities (Tokyo Stock Exchange: 8601.T-JP) notched down 0.9 and 0.4 percent respectively. The size of the offering was subsequently reduced to $811 million from $1 billion.
In Australia, the S&P/ASX 200 index finished 0.5% higher at 5,122.6, thanks to a bounce in banking shares.
“I would certainly put [Monday’s plunge] down to domestic factors, rather than genuine concern about the Fed starting to normalize policy”. At one point half of China’s listed stocks were banned from trading and a crackdown on mis-selling ensued – one that has humiliated securities regulators, hedge fund managers, bank executives, and journalists alike. Indeed, concerns are growing that another strong payrolls report could lead to rates rising at a faster pace than was now priced in.
In Hong Kong, Tencent was up 2.2 percent. The October figure was worse than the median 4.1% decline forecast in a Wall Street Journal poll.
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Standard & Poor’s 500 Index futures were down 0.1 percent after the benchmark gauge ended Tuesday up 0.2 percent following a day of fluctuations. 5 billion capital raising.
