SHANGHAI: China stocks rose on Friday as investors looked ahead to stimulus measures to aid growth, while comments by a US official on China were interpreted by some as positive.
China stocks rise on higher-than-expected borrowing rate cut
** Both China’s blue chip CSI300 index and the Shanghai Composite Index rose 0.2%. But for the week, CSI300 lost 1.9%, while the Shanghai index fell 0.5%.
** The United States will not block China from growing its economy, but wants it to adhere to international rules, Secretary of State Antony Blinken said in a speech on US strategy toward China.
** “We are not looking for conflict or a new Cold War. To the contrary, we’re determined to avoid both,” he said.
** Blinken’s speech “is generally interpreted to be on the positive side, given extremely low expectations on Sino-US ties,” said Yang Hongxun, an analyst at investment consultancy Shandong Shenguang.
** Profits at China’s industrial firms fell at their fastest pace in two years in April, data showed, but investors expect more market-friendly policies ahead, after Premier Li Keqiang vowed to ensure reasonable growth in the second quarter.
** China’s energy and healthcare stocks both rose more than 1%.
** Banking, tourism and industrial sectors also climbed, but real estate stocks and chipmakers fell. ** However, some investors remain cautious, concerned that China’s zero-COVID policy remains a key drag on the economy.
** “Macroeconomic confidence in China has now deteriorated to the point where what is required is not a loosening around the edges of these broad policy priorities, but wholesale policy U-turns,” wrote Alex Wolf, head of investment strategy, Asia at JPMorgan Private Bank.
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