Markets

China Seeks to Stimulate Economy

China Seeks to Stimulate Economy

The FTSE China A50 Index of large caps, which includes stocks most favoured by overseas investors, sank nearly 5 per cent for its biggest selloff since January 2016.

Spot gold was 0.1 percent higher, trading at $1,203.80 per ounce.

On Monday, Hong Kong's Hang Seng index was down 0.5 percent and a sub-index tracking information technology firms was 0.9 percent lower.

On Wall Street, the tech-heavy Nasdaq fell for the third straight day though the broad S&P 500 pared losses to end almost flat as defensive stocks offset a decline in growth shares.

Losses on major indexes in mainland China were as high as 4.8% in a major market rout, with the China A50, which includes major companies from both the Shenzhen and Shanghai indexes, as the biggest loser.

Wall Street pared some losses on a day the US bond market was closed because of the Columbus Day holiday.

Shares of the nation's biggest oil producer contributed to the bulk of a rebound in the benchmark Shanghai Composite Index, with a 4.4 per cent jump.

The selloff has spread to stocks in Hong Kong, among the world's worst performers this year. The Shanghai Composite is down 17.5 per cent this year.

A weeklong holiday for Chinese markets meant investors had an entire five days of news and data to digest in just one session, including an escalation of the trade war between China and the US.

On Sunday, the People's Bank of China (PBOC) announced a 100-basis-point cut to banks' reserve requirement ratio (RRR), stepping up efforts to support the economy and calm market worries.




The move remains targeted at adjustment with a goal to optimize the liquidity structure of commercial banks and the financial market and to reduce financing costs, said the central bank.

On Monday the State Council, China's cabinet, said it will increase export tax rebates from November 1 and will speed up export tax rebate payments in a new bid to boost the real economy and support trade growth.

The injection of cash into the economy will also boost hopes that the negative impact of higher USA tariffs on Chinese exports can be eased.

"The irony in all this is that with the United States yield curve steepening meaningfully, that is only likely to embolden the Fed that it can continue to tighten further", the analysts said.

"Whether it is just in response to the weight of evidence from the strong U.S. data or instead an active decision by Fed officials to steer the market more towards its tightening profile (the "dots") presented at its rate decision last month, there is little doubt that officials have turned more hawkish recently", analysts at ANZ said in a note.

The PBOC moved to cut the RRR over the weekend to increase liquidity in order to support lending and credit but the central bank also reiterated that this won't lead to yuan depreciation pressures.

"The ongoing China-US trade war is imposing headwind to China's growth, and monetary easing is being used to counter that", ChiXi Consultants said in a research note to its clients on Monday.

It also comes ahead of Monday's visit here by US Secretary of State Mike Pompeo for the second of talks with Chinese leaders on trade and security issues.

The yuan strengthened on Tuesday after falling sharply on Monday to its lowest official close in seven weeks.


  • Michael expected to gain hurricane strength nearing Florida

    Michael expected to gain hurricane strength nearing Florida

    The NHC also added in its advisory that Michael is likely to turn into a hurricane by Tuesday night or early Wednesday morning. An Air Force hurricane hunter airplane was sent into the storm to investigate, the hurricane center said.
    Wozniacki wins 2nd China Open title, Del Potro stumbles

    Wozniacki wins 2nd China Open title, Del Potro stumbles

    Sevastova has had the best season so far and will rise to a career-high ranking of 12 in the world. Caroline Wozniacki became the fourth active player with at least 30 titles on the WTA tour.
    Apple releases iOS 12.0.1 to fix charging and WiFi bugs

    Apple releases iOS 12.0.1 to fix charging and WiFi bugs

    Apple has rolled out iOS 12 .0.1 update which is around 157.5 MB in size to fix the iPhone XS charging issue . Most notably, iOS 12.0.1 patches an issue that was causing problems with iPhone charging via Lightning cable .
  • Sony Announces PSN Name Change Beta

    Sony Announces PSN Name Change Beta

    If you are not one of the lucky test users, you will need to wait until 2019, when a full roll out is planned for the feature. As per the EU PlayStation Blog , a "full preview program" is kicking off soon for the PS4 that will allow a PSN ID change.
    International Monetary Fund  predicts 7.3% growth rate for India in current fiscal year

    International Monetary Fund predicts 7.3% growth rate for India in current fiscal year

    Russian Federation was among the few energy-rich emerging market countries whose growth forecasts were bumped up. The IMF's projection is close to the World Bank's forecast of 7 percent for fiscal 2018-19, released on Oct 2.
    A closer look at the Houston Astros ahead of the ALCS

    A closer look at the Houston Astros ahead of the ALCS

    But the Red Sox , frequent visitors who clinched the AL East crown at Yankee Stadium just 2½ weeks ago, were hardly intimidated. Yankees: The 38-year-old Sabathia (9-7, 3.65) will be on 11 days' rest when he makes his 23rd postseason start.
  • Saudi royal family planned Khashoggi hit: NY Times

    Saudi royal family planned Khashoggi hit: NY Times

    For his part, Trump simply said , "Hopefully that will sort itself out". "Right now, nobody knows anything about it", he said. He has also said Turkey has no documents or evidence regarding the case.
    Arrests made after Khabib beats McGregor

    Arrests made after Khabib beats McGregor

    White said that it would be now up to the Nevada State Athletic Commission to decide if Nurmagomedov would face further sanctions. But let's hope that it doesn't come to this and we see both fighters in the ring sometime in 2019.
    Kavanaugh attends swearing-in ceremony at the White House

    Kavanaugh attends swearing-in ceremony at the White House

    Bush administration and his comments about Democrats using allegations of sexual assault against him, according to the Post. He has also played basketball in the Supreme Court's gym, which is jokingly referred to as the "highest court in the land".
  • USA  intercepted Saudi plans to capture missing journalist, report says

    USA intercepted Saudi plans to capture missing journalist, report says

    Sabah newspaper published the names and years of birth of 15 Saudis it said arrived at Istanbul's Ataturk airport on October 2. Turkish officials say they fear Khashoggi was killed, an allegation dismissed as " baseless " by Saudi Arabia .
    Suspect in Bulgarian journalist slaying arrested in Germany

    Suspect in Bulgarian journalist slaying arrested in Germany

    Those details led to widespread speculation that Ms Marinova's death might have been linked to her work as a journalist. And even some of Marinova's fellow journalists were not convinced that she was killed because of her reporting.
    Nikki Haley Resigns As UN Ambassador

    Nikki Haley Resigns As UN Ambassador

    The president left open the possibility of Haley returning to the administration, saying she would be welcome in any capacity. Haley's debts include a string of liabilities incurred over her years in the Trump administration and S.C. government.