The Mainland China equity market closed down on Friday, 08 November 2019, as investors digested recent developments on the U. S.-China trade front. Selloff also fueled after reports that the plan to cancel tariffs faces fierce internal opposition in the White House and from outside advisers. At closing bell, the benchmark Shanghai Composite Index declined 0.5%, or 14.53 points, to 2,964.19. The Shenzhen Composite Index, which tracks stocks on China's second exchange, dropped 0.2%, or 3.09 points, to 1,648.68. The blue-chip CSI300 index sank 0.47%, or 18.87 points, to 3,973.01.
Shares were pressured as reports that the plan to cancel tariffs faces fierce internal opposition in the White House and from outside advisers.
On Thursday, US and Chinese officials said the two countries will roll back tariffs on each others' goods in a "phase one" trade deal if it is completed.
Gao Feng, a ministry spokesperson for China's Commerce Ministry, said on Thursday that Beijing and Washington had agreed to simultaneously cancel some existing tariffs on one another's goods that has crimped economic growth and roiled markets. A spokesman for China's Ministry of Commerce told reporters these roll-backs could happen even before a "phase one" trade deal is signed. No timetable was indicated, but a phase one deal is widely expected to include a U. S. pledge to scrap tariffs scheduled for Dec. 15 on about $156 billion worth of Chinese imports, including cellphones, laptop computers and toys.
The US and China have imposed tariffs on each others' goods, worth billions of dollars worth of annual trade since last year. The duties have hurt trade, acting as a drag on the economies of both countries and putting pressure on their leaders to strike an agreement. The International Monetary Fund estimated that the US-China trade war will shave almost a percentage point off of global growth this year.
CURRENCY NEWS: China's yuan appreciated against greenback on Friday after the central bank set stronger mid-point fixing. Prior to market opening, the People's Bank of China (PBOC) set the midpoint rate CNY=PBOC at 6.9945 per dollar, 63 bps or 0.1% firmer than the previous fix of 7.0008 and the strongest since Aug. 6.
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