China stocks close up as stimulus hopes outweigh Trump concerns

Reuters

China stocks close up as stimulus hopes outweigh Trump concerns

2024 11월 7 일, 오전 8:24 GMT

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Updates to market close

SHANGHAI, Nov 7 (Reuters) -China and Hong Kong stocks ended higher on Thursday, buoyed by investor optimism over potential stimulus measures that outweighed concerns about worsening trade tensions under a second Donald Trump presidency.

The blue-chip CSI300 Index .CSI300 closed up 3%, while the Shanghai Composite Index .SSEC gained 2.6%.

Investor focus has now shifted to the National People's Congress Standing Committee meeting, which concludes on Friday. Any stimulus surprise from the meeting will likely help lift market sentiment in China stocks.

"I think it's very likely that we will see significantly more fiscal and monetary stimulus from Beijing, which could offset some of the trade headwinds," said David Chao, global market strategist for Asia Pacific (ex-Japan) at Invesco.

Consumer-related stocks .CSI399997 and financial shares .CSI300FS led gains in China, up 5.7% and 4.7%, respectively, as market participants expect more stimulus measures.

That helped offset some of the concerns about what a second Trump administration would mean for China's economy.

China will continue to implement a supportive monetary policy to help promote sustained economic recovery, Pan Gongsheng, governor of the country's central bank, said in remarks published on Thursday.

Hong Kong's Hang Seng .HSI, which is more indicative of foreign investor sentiment, rose 1.9%, recouping some losses of the previous day. The Hang Seng China Enterprises Index .HSCE was up 2.5%.

"I think investors will learn from the first Trump term," said Wei Li, head of multi-asset investments for China at BNP Paribas. "Investors gained insights into how trade policies, tax reforms, and regulatory changes affect markets, allowing them to adjust their portfolios accordingly."

A threat by Trump to impose 60% tariffs on U.S. imports of Chinese goods poses major growth risks for the world's second-largest economy.

Mainland property developers traded in Hong Kong jumped 4%.

Meanwhile, China's exports grew at the fastest pace in more than two years in October, beating expectations, while imports shrank, customs data showed on Thursday.

Exports have bolstered growth for China although tariff threats have cast doubts over the outlook. A Republican sweep scenario could give Trump greater sway over taxes and tariffs.

Electronics and computer equipment, plastics and rubber, and lower value-added consumer goods such as apparel would be most affected, as they have relatively lower existing U.S. tariffs and make up a larger share of both U.S. imports and China's exports, said Morgan Stanley analysts led by Robin Xing in a note.

Chinese President Xi Jinping on Thursday sent a telegram to Trump congratulating him on his election, China's state-run Xinhua news agency reported.

While the U.S. election may cause short-term fluctuations in onshore equities, the medium- to long-term trends are more closely linked to domestic conditions and corporate earnings, said analysts at Alliance Bernstein in a note.

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Reporting by Shanghai Newsroom; Editing by Jacqueline Wong and Sam Holmes

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