China stocks set for monthly gain on hopes of better Beijing data, fresh stimulus

HONG KONG: Chinese stocks rallied on Friday, and were set for monthly gains, on hopes of factory data this weekend showing a pick-up in activity and as investors bet on more stimulus after a key policy meeting next month.

China stocks drop on heightened trade tensions

• At the midday break, China’s blue-chip CSI300 index was up 2.01%, the best gain in three weeks. The Shanghai Composite index added 1.59% at 3,348.20 points.

• The financial sector sub-index advanced 2.19%, the consumer staples sector rose 2.17%, the real estate index added 1.65% and the healthcare sub-index gained 2.28%.

• Hong Kong equities also gained on the day, with the Hang Seng Index climbing 1.29% at 19,616.44.

• However, being more sensitive to international investors’ sentiment towards China, the stocks were set for a second month of losses on looming geopolitical uncertainties and tariff risks.

• China’s factory activity likely expanded modestly for a second straight month in November as the stimulus trickled through, a Reuters poll showed, though threats of new US trade tariffs clouded the outlook.

• The official purchasing managers’ index (PMI) due Saturday is expected to come in at 50.2, higher than October’s 50.1 and above the 50-point threshold that separates growth from contraction in activity.

• Meanwhile, the long-running property downturn is expected to see some improvement, with home prices set to fall at a slower pace this year and next to stabilise in 2026, according to a separate Reuters poll.

• The gains in the onshore market on the day helped recoup all the losses seen earlier in November, putting the CSI 300 Index on track to register the best month since the policy blitz began in September.

• Investors are also eyeing December’s Central Economic Work Conference, which could provide more details about the fiscal budget and the scale of stimulus for consumption for the next year, Kevin Liu, managing director and strategist at CICC Research, said.

• “The meeting will be the short-term focus and performance will likely fluctuate around market expectations.”