Mainland Chinese stocks began a catch-up rally tracking their regional counterparts on Monday as investors returned from a long Labor Day holiday, while the Hong Kong market edged lower.
The Hong Kong market fell slightly. ** Shares in other Asian countries rose on renewed bets that the U.S. Federal Reserve is likely to cut rates this year, while the yen weakened after a sharp rise last week following suspected monetary intervention from Tokyo.
** Sentiment also improved as China would strengthen its support for the economy through prudent monetary policies and proactive fiscal policies, including interest rates and bank reserve requirement ratios, the Politburo said of the Communist Party, cited by state media.
**The statement from the April Politburo meeting reflected a strong commitment to boost growth, particularly in the discussion on potential real estate destocking measures,” said Jason Lui, head of equity and derivatives strategy APAC at BNP Paribas in a note.
He upgraded his view on the MSCI China Index (MXCN) to the bull case as his new base case, suggesting a further 4% upside from current levels.
**The Shanghai Composite index was up 1.05% at 3,137.36 points at midday, while the CSI 300 index rose 1.53%.
** Financial sector, consumer staples, real estate and healthcare sub-indexes rose 1% to 2.77%.
**Hong Kong-listed Chinese H-shares fell 0.26% to 6,529.98, while the Hang Seng Index slipped 0.05% to 18,466.91.
** The smaller Shenzhen index rose 1.96%, the start-up ChiNext Composite index rose 2.18% and the tech-focused Shanghai STAR50 index advanced of 1.63%.
** In the region, MSCI’s index of Asian stocks excluding Japan rose 0.48%, while Japan’s Nikkei index fell 0.10%.
**The yuan was quoted at 7.2142 per US dollar, up 0.15% from its previous close of 7.225. (Reported by Shanghai Newsroom; edited by Varun HK)
