China Market falls on fret over reopening

Mainland China share market finished session lower on Wednesday, 28 December 2022, as investors assessed the impact of China dismantling COVID-19 curbs. At close of trade, the benchmark Shanghai Composite Index declined 0.26%, or 8.17 points, to 3,087.40. The Shenzhen Composite Index, which tracks stocks on China's second exchange, dropped 0.95%, or 19 points, to 1,974.33. The blue-chip CSI300 index was down 0.43%, or 16.59 points, to 3,871.26.

China said on Tuesday it would drop its quarantine rules for inbound travelers starting January 8, largely reopening a border that has been locked up for almost three years.

A faster-than-anticipated peak of infections in mainland China has stoked expectations that a quick economic recovery is on the cards. But a surge in cases that is straining resources and putting hospitals under pressure has curbed investor enthusiasm.

 

ECONOMIC NEWS: North China's coal-rich Shanxi Province has completed its annual coal production target of 1.3 billion tonnes as of Tuesday, according to the provincial statistics bureau Wednesday. The province continues to rank first in coal output in China this year and has realized an average annual increase of more than 100 million tonnes for the second consecutive year.

CURRENCY NEWS: The Chinese currency was down against the U.S. dollar on Wednesday, after China's central bank set a softer midpoint rate. Prior to market open, the People's Bank of China set the midpoint rate CNY=PBOC at 6.9681 per U.S. dollar, weaker than the previous day fix of 6.9546. The spot rate is currently allowed to trade 2% above or below the official fixing on any given day. In the spot market, the onshore yuan CNY=CFXS was changing hands at 6.9747 at midday, 146 pips weaker the previous late session close and 0.09% away from the midpoint.

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