Takeaway: The private survey of purchasing managers conducted by IHS Markit
Archegos Unwind: After yesterday’s close, it was rumored that Credit Suisse
The vast majority of Asian equity markets reopened today on light volumes and little news. Meanwhile, Hong Kong and Thailand enjoyed another day off.
A Bloomberg article about a PBOC meeting weeks ago is making the rounds as banks are being asked to rein in loan growth. The article was a non-event in market action. The PBOC wants to see loan growth aligned with economic growth. The strong PMI release didn’t release animal spirits as the market is still recovering from the recent correction. There were elements of value outperformance versus growth as communication, tech, energy, financials, and industrials had a positive day while healthcare, consumer discretionary, and staples were off.
Private equity firm KKR
The Wall Street Journal did a piece on the digital renminbi. While the article focused on a digital renminbi as a threat to the US dollar, the simple reality is a logical step for China where mobile payments are largely accepted and widely used.
Yesterday, several US-listed Chinese education names were weak on new rules, which set a limit on how late tutoring be conducted. This morning, several analysts are stating it is a non-event for the companies.
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Hong Kong was closed today and will remain so until Wednesday.
Shanghai, Shenzhen, and STAR Board bounced around the room closing -0.04%, +0.18%, and -0.25% respectively in volatile trading driven by low volumes, which were off -7.6% from Friday and just 75% of the 1-year average. Breadth saw 2,572 advancers and 1,225 decliners. The most heavily traded stocks by volume were Longi Green Energy, which rose +4.84% as the company enters the hydrogen business, Kweichow Moutai, which fell -1.66%, BOE Tech, which gained +0.16%, BYD, which was up +0.13%, China Tourism, which fell -4.89% despite very strong traveling during the three day weekend, liquor stock Wuliangye Yibin, which pulled a James Bond gaining +0.07%, broker East Money, which fell -0.9%, Sungrow Power, which rose +1.65%, JiuGui Liquor, which was up +1.94%, and battery maker CATL, which was off -1.99%. Northbound Stock was closed today while CNY appreciated versus the US $ a touch and copper was strong.
Last Night’s Exchange Rates, Prices, & Yields
- CNY/USD 6.55 versus 6.57 Friday
- CNY/EUR 7.75 versus 7.76 Friday
- Yield on 1-Day Government Bond 1.59% versus 1.50% Friday
- Yield on 10-Year Government Bond 3.21% versus 3.20% Friday
- Yield on 10-Year China Development Bank Bond 3.59% versus 3.58% Friday
- China’s Copper Price +1.63% overnight
Krane Funds Advisors, LLC is the investment manager for KraneShares ETFs. Our suite of China focused ETFs provide investors with solutions to capture China’s importance as an essential element of a well-designed investment portfolio. We strive to provide innovative, first to market strategies that have been developed based on our strong partnerships and our deep knowledge of investing. We help investors stay up to date on global market trends and aim to provide meaningful diversification. Krane Funds Advisors, LLC is majority owned by China International Capital Corporation (CICC).
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