Fiscal Stimulus Hopes Keep China Indexes Above Flatline

Li Chen
22 Oct, 2024
Hong Kong

Stocks in China advanced in the hopes of additional fiscal measures following monetary policy measures to support property market lending and easing of regulatory curbs on residential property transactions in large cities. 

The Hang Seng index increased 0.1%, the CSI 300 index advanced 0.2%, and the yuan traded at 7.13 against the U.S. dollar. 

In cautious trading, investors held out for additional fiscal stimulus measures following a raft of monetary policy stimulus measures announced by the central bank last month. 

Investors are looking forward to announcements from the committee of the National People's Congress approving increased borrowing limits and government spending plans. 

Those measures for issuing additional debt may take more than two months and may fall short of market expectations. 

China's policymakers are struggling on several fronts as local government debt hovers at record levels, the working-age population shrinks, and industrial overcapacity dampens investor enthusiasm. 

The Chinese economy is undergoing deep structural changes, and investors are struggling to reconcile as GDP annual growth is expected to slow to less than 3% over the next three years. 

 

China Stock Movers 

The Hang Seng index increased 0.1% to 20,496.15, and the mainland-focused CSI 300 index rose 0.2% to 3,942.67. 

Ping An Insurance Group decreased 1.8% to HK $48.15 after the company reported weaker-than-expected results. 

The insurance company reported third quarter income was 44.6 billion yuan, or $6.3 billion, and fell short of market expectations of 50.3 billion yuan. 

Electric vehicle makers advanced on the speculation that sales in the current month are running ahead of the previous month. 

Li Auto increased 5.2% to HK $101.20, Geely Automobile Holdings soared 7.2% to HK $13.66, Xpeng increased 3.2% to $42.50, and BYD declined 2.9% to HK $284.80.