Mainland China equity market finished session at one-week high on Wednesday, 25 March 2020, joining global market rally, after news that Senate leaders and the Trump administration had reached an agreement to pass a $2 trillion stimulus package. Also helping sentiment, mainland China reported a drop in new confirmed coronavirus cases on Wednesday as imported infections fell and no locally transmitted infections were reported. At closing bell, the benchmark Shanghai Composite Index advanced 2.17%, or 59.15 points, to 2,781.59. The Shenzhen Composite Index, which tracks stocks on China's second exchange, rose 2.92%, or 48.63 points, to 1,714.86. The blue-chip CSI300 index added 2.7%, or 97.41 points, to 3,722.52.
CSI300's financial sector sub-index rose higher by 2.3%, the consumer staples sector was up 2.1%, the real estate index rallied 5% and the healthcare sub-index gained 3.4%.
Investor sentiment got a boost from hopes for a massive US stimulus package to counter the impact of the pandemic, as well a deal to postpone the 2020 Tokyo Games until next year.
The White House and Senate reached a deal on a gigantic $2 trillion coronavirus stimulus bill early Wednesday stateside. The massive stimulus is designed to be a lifeline to Americans and their employers until the coronavirus is brought under control and the country finds some semblance of normalcy.
Also helping sentiment, mainland China reported a drop in new confirmed coronavirus cases on Wednesday as imported infections fell and no locally transmitted infections were reported. The country appears to be getting back to work. More than one fifth of American companies in China are back to normal operations, a survey showed Wednesday.
CURRENCY NEWS: China's yuan weakened against the dollar on Wednesday, in spite of China central bank fixed stronger mid-point rate, as companies ramped up demand for the greenback when it dipped below a certain threshold. Prior to market opening, the People's Bank of China (PBOC) set the midpoint rate CNY=PBOC at 7.0742 per dollar, 257 pips or 0.36% firmer than the previous fix of 7.0999. The onshore spot yuan CNY=CFXS opened at 7.0610 per dollar, rose to a high of 7.0491 before changing hands at 7.0680 at midday, 60 pips weaker than the previous late session close.
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