China stocks fall 2% as COVID curbs, inflation woes dent appetite

SHANGHAI: China stocks fell on Monday as the country grapples with the COVID-19 outbreak, while an inversion in the 10-year spread between domestic and US yields and the fast pace of China’s factory-gate and consumer prices also dampened risk appetite.

** The CSI300 index was down 2.4% at 4,131.33 points by the end of the morning session, while the Shanghai Composite Index lost 1.8% to 3,195.07 points.

** The Hang Seng index dropped 2.5% to 21,331.83 points. The Hong Kong China Enterprises Index lost 3% to 7,266.77.

** The worst outbreak of COVID-19 in two years has led to a production suspension in electric vehicle maker Nio Inc and prompted Battery giant Contemporary Amperex Technology (CATL) to implement a so-called “closed-loop management” system at its main factory to keep production going.

** Mainland China reported 1,184 new confirmed coronavirus cases and 26,411 new asymptomatic cases on April 10.

China stocks seesaw amid COVID outbreak, stimulus expectations

** Pulling investor sentiment further down, China’s producer price index increased 8.3% year-on-year, easing from 8.8% growth in February. The consumer price index inched up 1.5% year-on-year, the fastest pace in three months.

** Yields on China’s 10-year government bonds fell below US Treasury yields for the first time in 12 years on Monday, raising concerns of less attractiveness of yuan-denominated assets.

** Outflows through the Northbound leg of Stock Connect totalled 5.67 billion yuan ($890 million), as of midday break, according to Refinitiv data.

** China will step up policy measures in timely way to support the economy while studying new stimulus plans, state media on Friday quoted Premier Li Keqiang as saying.

** Shares of Nio dropped 8.8% in Hong Kong while CATL lost 7.3% in Shenzhen. ** Shares of new-energy firms slipped 4.6%, new energy vehicles plunged 5.5%, while automobiles declined 3.7%.

** Stocks in semiconductors, non-ferrous metal and machinery tumbled roughly 4% each, while consumer staples and real estate developers lost 1.5% and 1.1%, respectively.

** Tech giants listed in Hong Kong fell 4%, with video and livestreaming platform Bilibi tumbling 11.4%. Index heavyweights Meituan retreated 4.7% and Alibaba went down 3.8%.

** Hong Kong-listed shares of mainland property developers lost 3.8%.