China Stocks Rise on Trade Financing

123jump.com Staff
05 Dec, 2008
New York City

Stocks in Shanghai and in Hong Kong surged after China offered more capital to stimulate the economy. U.S. and China provided together $20 billion for export financing. India and China plan to carry out a joint military exercise to combat rising terrorism in Mumbai.

[R]6:00AM New York, 6:00PM Hong Kong – China and U.S. commit $20 billion for trade finance to sustain exports from the region.[/R]

Hong Kong market index rose on a rise in financial and realty stocks after the State Council reported that it will stimulate growth in key areas through the exchange rate and liquidity policy.

In Hong Kong trading Hang Seng Index rose 2.5% or 336.31 to 13,846.09, and the China Enterprises Index of Hong Kong listed mainland shares, or H shares, gained 2.8% or 201.35 to 7,428.54. In Shanghai trading CSI 300 Index soared 1.5% or 30.25 to 2,013.18.

China, U.S. Pledge US$20 billion for Trade Finance

Xinhua News Agency reported today that China and U.S. have pledged $20 billion for trade finance in order to stimulate global commerce. The pronouncement was made at the end of the two-day China-U.S. strategic Economic Dialogue held in Beijing.

US Export-Import Bank will provide additional resources of $12 billion and the Export-Import Bank of China will provide $8 billion to assist in the financing of the export of China and US goods and services.

China to Provide Extra Rmb100 billion

China’s State Council reported on Wednesday this week it will provide an additional Rmb100 billion to three policy banks in order to stimulate the economy.

The body also announced that it will use interest rates, the exchange rate and liquidity policy to prop up development in key sectors.

Gainers & Losers

Financial stocks rose on speculation that the People’s Bank of China will lower key interest rates and cut the reserve requirements on banks to stimulate economic activity of growth.

China Construction Bank and ICBC advanced more than 1%. China Life Insurance rose 3.7% and Ping An Insurance surged 6.1%.

Realty stocks also gained. Guangzhou R&F Properties advanced 12.4%.