India's driest August in more than 100 years may force the country to impose additional export restrictions!
Source: Barchart, Bloomberg
China's holdings of US Treasuries just reached its lowest level in 14 years
Now down almost $481B from peak levels. Source: Crescat Capital, Bloomberg
China Uses Another Tool to Aid Yuan in String of Market Support – Bloomberg
China moved to support the yuan by increasing the supply of foreign currency in its local market, part of a multi-pronged effort by Beijing to restore confidence amid sluggish growth. Financial institutions will need to hold just 4% of their foreign-exchange deposits in reserve starting Sept. 15, the People’s Bank of China said Friday, compared to the current level of 6%. The greater availability of overseas currency relative to the yuan effectively boosts the allure of the latter. The so-called FX RRR cut came on the heels of Thursday’s reduction in down payments for mortgages to help the country’s under-pressure residential property market and after policymakers lowered stamp duty for stock trading over the weekend. The combination of supportive measures is a sign that Beijing is growing uncomfortable with increasing pessimism in its financial markets.
The US and China are the ones investing massively in innovation and the future
Europe is lagging and prefer first to debate about regulating AI. Thsi could have serious consequences in terms of competitivity, productivity and economic growth. Source: Standard Chartered, Michael A.Arouet
There is a new penny stock...
After a 17-month trading hiatus, Evergrande trading resumed only to quickly become a penny stock Source: Barchart, Bloomberg
Magazine covers happen to be quite effective as contrarian indicators (i.e peak pessimism usually takes place at the bottom; peak optimsim at the top).
Could The Economist cover page on #china (Xi's failing model) coincide with a bottom for Chinese equities? China stocks surged on Monday after authorities announced a package of measures over the weekend to boost investor confidence, including halving the stamp duty on stock trading. China’s blue-chip CSI 300 Index jumped roughly 3% in early morning trade, on course for its best day since November, while the Hang Seng benchmark advanced more than 2%.
Chinese stocks slid in early Friday trading, an indication of entrenched investor pessimism even after authorities urged the nation’s top financial institutions to help stabilize a struggling market.
The CSI 300 Index of shares in Shanghai and Shenzhen dropped as much as 0.7% shortly after the opening bell, extending its slump this month to 7.7% and keeping it as one of the world’s worst performers this year. A key gauge of Hong Kong-listed Chinese firms declined a maximum 1.3%. The selling came after the China Securities Regulatory Commission used a seminar Thursday with executives from the country’s pension fund, some large banks and insurers to ask them to boost support for the market. The market’s indifference isn’t necessarily a surprise, given regulators have held similar meetings regularly in the past and they have rarely had a significant impact. Source: Bloomberg
Overnight, Chinese banks made a smaller-than-expected cut to their benchmark lending rate
(cut 1-year rate by 10bps; no change in 5-year while the market was expecting a 15-basis-point cut on both rates) and avoided trimming the reference rate for mortgages, despite the PBOC urging lenders to boost loans. Banks’ failure to follow the central bank suggests they were unprepared, but that cuts to their lending rates may still arrive in the coming months.. Meanwhile, The Hang Seng Index declined as much as 1.8% and was set for its lowest close since November. Shares in mainland China also dropped into a second day, with finance stocks among the worst performers. Source: Bloomberg
