China stocks edge lower as global slowdown concerns weigh

1/7/2022 13:09

        China stocks edged down on Friday, tracking Asian markets as investors increasingly fretted over global economic outlook, even as a private sector poll showed Beijing's manufacturing activity expanded at its fastest in 13 months in June. Hong Kong market is closed for the Hong Kong Special Administrative Region Establishment Day. The CSI300 index fell 0.3% to 4,470.64 points at the end of the morning session, while the Shanghai Composite index lost 0.2% to 3,392.36 points. ** So far this week, the CSI300 index gained 1.7% and the Shanghai Composite index added 1.3%. ** Asian stock markets made a shaky start to the second half under growth clouds, while the S&P 500 closed out its worst first half since 1970 overnight. ** "Outside recession shock seems unavoidable, but the long-term performance of China stocks really depends on domestic fundamentals," Guosheng Securities analysts said in a note. ** The Caixin/Markit manufacturing purchasing managers' index
        (PMI) rose to 51.7 in June, indicating the first expansion in four months and matching with the findings in a Thursday official survey. ** China will issue 300 billion yuan ($44.78 billion) in financial bonds to replenish capital of key projects, or provide bridge financing for projects funded by special bonds, state media on Thursday quoted the cabinet as saying, in a move to help boost financing support for key investment projects. ** "This is yet another positive for the Chinese economy in the short run," said Nomura analysts led by Ting Lu in a note. However, "Beijing will still very likely miss the 'around 5.5%' growth target." ** The news pushed non-ferrous metal, infrastructure companies and construction engineers up more than 1% each. ** "Re-calibration of China's COVID restrictions drove this week's improved market sentiment, we believe, and should help boost investor confidence after the recently stepped up easing and tech regulation completion,"
        Morgan Stanley analysts said in a note. ** "We are incrementally constructive on Chinese equities and continue to recommend selectively adding back growth exposure in overall China allocation." ** Tourism stocks tumbled 4%, but were still up 8.5% so far this week as investors found comfort in the easing of COVID-19 rules.