December 18, 2019 / 5:21 AM / 2 months ago

China stocks snap rally as trade euphoria eases

* SSEC -0.1%, CSI300 flat, HSI -0.1%, HSCE +0.2%

* Kudlow says deal ‘done’ after China officials sound caution

* PBOC trims repo rate; state planner rejects big infra spending

HONG KONG, Dec 18 (Reuters) - China stocks took a breather on Wednesday from three sessions of gains, retreating from multi-month highs, as weary investors awaited concrete details from Beijing and Washington on their initial agreement to defuse the 17-month-long tariff war.

** At the midday break, the Shanghai Composite index was down 0.1% at 3,020.06 points, trading a notch lower from its highest level since mid-September hit on Tuesday. ** The blue-chip CSI300 index was almost unchanged from the previous close and hovering near its strongest level since April, also hit in the previous session. ** CSI300’s financial sector sub-index rose 0.2%, the consumer staples sector was flat and the real estate index edged down 0.3%. ** Chinese H-shares listed in Hong Kong rose 0.2%. The Hang Seng Index dipped 0.1% to 27,822.79, slightly lower from its highest level since late-July hit earlier in the session. ** The smaller Shenzhen index gained 0.2% and the start-up board ChiNext Composite index was weaker by 0.3%. ** The so-called “phase-one” trade deal between Washington and Beijing has been “absolutely completed,” a top White House adviser said on Monday, adding that U.S. exports to China will double under the agreement. ** Kudlow’s remarks came after Chinese officials emphasized that the trade dispute has not been completely settled. ** The Trump administration is finalising a set of narrow rules to limit exports of sophisticated technology to adversaries such as China, a document seen by Reuters shows. ** China’s central bank on Wednesday lowered the interest rate on 14-day reverse repurchase agreements by five basis points, having unexpectedly trimmed the seven-day benchmark last month for the first time in more than four years. ** China will take a targeted approach to boosting investment and will not resort to massive stimulus in its infrastructure push, the state planner said on Tuesday, as Beijing ramps up support to stabilise its slowing economy. ** Beyond this week, however, equities will be shored by expectations of policy support, foreign investment inflows and progress in the trade talks, Greater Wall Securities’ analysts wrote in a note on Wednesday. ** Around the region, MSCI’s Asia ex-Japan stock index was barely changed while Japan’s Nikkei index was down 0.4%. ** The Shanghai stock index is above its 50-day moving average and above its 200-day moving average. ** In Hong Kong, the sub-index of the Hang Seng index tracking energy shares rose 1.1% while the IT sector was trading flat.

Reporting by Noah Sin, Editing by Sherry Jacob-Phillips

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