In recent months, policymakers have announced a series of targeted measures and a massive issuance of billions of dollars in bonds aimed at boosting infrastructure spending and stimulating consumption.
“China needs to act quickly and aggressively to avoid the risk of deflationary expectations taking root among consumers,” said Zhiwei Zhang, president and chief economist at Pinpoint Asset Management. Ta.
China fell into deflation in July for the first time since 2021, and barring a temporary rebound in August, prices have fallen continuously since then.
“The main drag on inflation remains food prices, which fell 5.9% year-on-year to the lowest level on record,” said Lin Song, chief economist for Greater China at ING Bank.
5 things to start your day
1) Britain’s first civilian nuclear power station begins operation on Teesside | Small modular nuclear reactor on the shores of Rover Tee expected to be operational by early 2030s
2) Courier Yodel is preparing to call the administrator. | Hopes for bailout deal evaporate as shipping companies struggle to find buyers
3) Giorgia Meloni goes to war with Italian carmaker royalty | The prime minister is facing intense scrutiny for his nationalist stance, and is fighting a battle with the influential Agnelli family.
Four) OBR chief says he will cut benefit bills rather than rely on immigration to reduce debt | Plus: David Miles warns welfare reform is essential to strengthen UK finances
Five) Matthew Henderson: The West does not understand the scale of the disaster facing China | Our precious illusions about how Xi Jinping will react to his country’s sinking are about to melt away
what happened overnight
The Tokyo stock market rose on the back of gains in tech stocks, but fresh comments from the central bank on maintaining accommodative financial conditions helped boost buying.
Japanese investment giant SoftBank Group reported net profit of 950 billion yen (5.1 billion pounds) for the last three months of 2023, turning a profit after four consecutive quarters of losses.
Hong Kong’s benchmark fell and Shanghai’s rose after China replaced the head of its stock market regulator.
The Chinese government has struggled to prop up some of the world’s worst-performing markets this year. Late Wednesday, as part of those efforts, the head of China’s equity regulator was replaced by a former chairman of the Shanghai Stock Exchange.
Wu Qing, a former banker and former Shanghai vice mayor, has been dubbed the “butcher of brokers” for his track record of cracking down on market abuses such as insider trading, analysts say.
The Shanghai Composite Index rose 1.2% to 23,862.31, while the Shenzhen Parts Index in China’s smaller major market rose 2.2%.
Hong Kong’s Hang Seng fell 0.9% to 15,941.66, with heavy selling in technology companies, despite big gains in real estate developers.
Yesterday, Ford, Chipotle Mexican Grill and other major stocks rose after the latest earnings reports, pushing Wall Street on the brink of another record milestone.
The S&P 500 index came within a fraction of 5,000 points, ending the day at 4,995.06. The index rose 0.8%, setting a new closing high. The Dow Jones Industrial Average rose 0.4% to 38,677.36, and the Nasdaq Composite Index rose 0.9% to 15,756.64.
In the bond market, US Treasury yields remained relatively stable. The yield on the benchmark 10-year U.S. Treasury note rose slightly to 4.11% from 4.09% late Tuesday.