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HONG KONG. — China stocks ended higher yesterday on recovering global investor sentiment, but gains were modest ahead of March-quarter GDP data that is expected to show an economic contraction for the first time in nearly 30 years. The Shanghai Composite index closed up 0,3 percent at 2 819,94, while the blue-chip CSI300 index gained 0,1 percent, having fitted in and out of negative territory.
CSI300’s financial sector sub-index was higher by 0,1 percent, the consumer staples sector was down 0,3 percent and the healthcare sub-index edged up 0,4 percent. — The smaller Shenzhen index added 0,5 percent and the start-up board ChiNext Composite index gained by 1,6 percent.
China is expected to publish its first-quarter GDP, activity data 0200 GMT today.
A Reuters poll shows the coronavirus crisis likely knocked China’s economy into its first decline since at least 1992 in the first quarter, raising the heat on authorities to do more to restore growth as mounting job losses threaten social stability.
“Although the market is already expecting the shock to first-quarter economic activity, the difficult reality of company performance will nevertheless pressure share prices,” analysts at Everbright Securities wrote in a note.
But Alex Wong, director at Ample Finance in Hong Kong, said investors care less about GDP data in China than whether the epidemic comes under control globally, which explains why A-shares followed US futures higher in afternoon trade.
S&P E-mini futures were up 0,8 percent at 0740 GMT and European futures also pointed higher.
“GDP is lagging so it wouldn’t matter as much because people (in markets) will focus on the future . . . One thing we are seeing (in China) is better consumer behaviour,” said Wong. “Sentiment-wise, it’s not too bad right now.”
China reported fewer new coronavirus cases involving travellers arriving from overseas, but locally transmitted infections rose, with the Chinese capital seeing new local cases for the first time in more than three weeks.
China’s new home prices in March grew at their slowest annual pace since June 2018, but a pick-up in momentum reflected some signs of recovery. The CSI300 real estate index ticked up 0,4 percent. — Around the region, MSCI’s Asia ex-Japan stock index was weaker by 0,4 percent, paring losses from earlier in the day, while Japan’s Nikkei index closed down 1,3 percent. — At 0703 GMT, the onshore yuan was 0,09 percent weaker 7,0751 at 7,0766 per US dollar. — So far this year, the Shanghai stock index is down 7,5 percent and the CSI300 has fallen 7,2 percent. Shanghai stocks have risen 2,5 percent this month. — About 20,30 billion shares were traded on the Shanghai exchange. The volume in the previous trading session was 20,56 billion. — Reuters.
Online Reporter