China Stocks fall 2.6%

The Mainland China share market closed lower on Monday, 11 April 2022, as Covid curbs in the country threatened to exacerbate supply-chain snarls.

Meanwhile, selloff pressure intensified on worries about inflation risks after high domestic factory-gate and consumer inflation. Also, weighing on sentiments were concerns of money flows out of China amid widening divergence between the U.S. and Chinese economies.

At close of trade, the benchmark Shanghai Composite Index declined 2.61%, or 84.72 points, to 3,167.13. The Shenzhen Composite Index, which tracks stocks on China's second exchange, fell 3.33%, or 69.32 points, to 2,011.45. The blue-chip CSI300 index sank 3.09%, or 130.70 points, to 4,100.07.

CURRENCY NEWS: China's yuan was down against the U.S. dollar despite firmer mid-point fixing by the central bank, due to concern over capital outflow and currency depreciation pressure after benchmark yield differentials between the world's two largest economies turned negative. Prior to market opening, the People's Bank of China (PBOC) set the midpoint rate CNY=PBOC at 6.3645 per dollar, 8 pips firmer than the previous fix 6.3653. In the spot market, onshore yuan CNY=CFXS opened at 6.3650 per dollar and was changing hands at 6.3725 at midday, 81 pips weaker than the previous late session close.

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