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China blue chips fall on cenbank's monetary policy stance

Reuters2021-09-08

SHANGHAI, Sept 8 (Reuters) - China’s blue-chip stocks fell on Wednesday as central bank officials vowed to maintain a prudent monetary policy, while state media said the country’s long-term economic policy remains unchanged.

The blue-chip CSI300 index fell 0.4% to 4,972.13, while the Shanghai Composite Index was flat at 3,675.19 points.

China’s central bank officials said liquidity supply and demand will remain balanced in the coming months, and China will maintain prudent monetary policy without resorting to flood-like stimulus.

Based on the message, Nomura lowered the probability of a targeted reserve requirement ratio (RRR) cut in September-October to 50% from 70% previously.

“The PBoC could opt to use some alternative low-profile and more targeted tools for supporting groups such as SMEs,” said Nomura in a note, citing small-and-medium enterprises.

State media outlet People’s Daily said on Wednesday China’s long-term economic policy remains unchanged and regulations on its industries are to promote their healthy development.

The consumer staples sub-index, the new energy sub-index and the machinery sub-index fell 1.2%, 2%, and 2.5%, respectively.

The coal sub-index surged 3.3%, as the tight coking coal supply in China has fuelled the rally in prices of the steelmaking ingredients.

China’s state planner has banned an influential coal trading firm from publishing price assessments and market news, part of government efforts to regulate commodities markets and tame hot prices.

The infrastructure sub-index jumped 2.3% to its highest in nearly two years. (Reporting by Shanghai Newsroom; Editing by Ramakrishnan M.)

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Comment1

  • Portfolio50
    ·2021-09-08
    "Flood like" stimulus. I like this term. 
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    • gupzbajaj
      nice terminology. pls like n comment
      2021-09-09
      Reply
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