Chinese stocks down as markets reopen
15 Feb 2016
China stocks fell this morning, but losses were softened by a sharply stronger yuan and a surge in gold shares after the market reopened from the week-long Lunar New Year holiday.
A sharp fall in Chinese-listed shares in Hong Kong coupled with a global sell-off last week driven by falling commodity prices as also concerns about the impact on European banks, had adversely affected investor sentiment at reopening of China's stock markets.
However, even with disappointing Chinese trade data early in the session, initial losses stood pared by the midday break. Exports dropped 11.2 per cent in January from a year earlier and imports plummeted 18.8 per cent, both ending up worse than expected.
China's blue-chip CSI300 index dipped 1.4 per cent, at 2,921.23 points, while the Shanghai Composite Index was down 1.6 per cent, to 2,720.03 points.
Hong Kong stocks, which were down revived in a smart rally, in response to a jump in Japan today and a Friday rebound in the US and European markets.
The Hang Seng index surged 2.7 per cent, to 18,819.59 points, while the Hong Kong China Enterprises Index rose 4.3 per cent, to 7,829.12.
The People's Bank of China (PBOC) set its midpoint 0.3 per cent stronger ahead of the market open, the biggest rise since 2 November last year.
According to traders, the midpoint's strength reflected the dollar's global weakness last week.
The break saw, the dollar index drop 1.5 per cent against a basket of currencies, which pushed the offshore yuan 0.9 per cent stronger during the same led by the euro period.
The Chinese currency is under depreciation pressure due to the sharp slowdown in the world's second-largest economy and after the sharp appreciation of the dollar against non-dollar currencies over the past several months until its sudden weakness since early February.
