Mainland China’s market reopened on Friday after a seven-day break in celebration of the October 1 National Day. The SSE Composite Index gained 1.15% at the Friday open from the previous close, and the Shenzhen Component Index was up about 1.04%.
In Hong Kong, the Heng Seng Index climbed opened 1.47% higher. The Heng Seng saw its biggest rally in over two months on Thursday, surging 3.1%.
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Chinese president Xi Jinping and US president Joe Biden are planning to meet virtually before the end of 2021, according to various media reports.
The two leaders have reached an “agreement in principle” for a virtual meeting and details will be worked out in the coming days, CNBC reported, citing a senior US administration official. The meeting “will be part of an effort to manage competition between the two countries”, said the report.
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The Caixin China purchasing managers’ index (PMI) rose 0.8 percentage point in September to 50, latest data shows.
The official manufacturing PMI, released at the end of September by the National Bureau of Statistics (NBS), moved in the opposite direction to drop to 49.6, falling into the contraction zone for the first time since March 2020. The official PMI tracks activities at large manufacturers in the country, while the Caixin gauge focuses on their smaller, private counterparts.
The Caixin services PMI jumped to 53.4 from August’s 46.7. The NBS non-manufacturing PMI, too, edged back to expansion territory last month to 53.2, climbing 5.7 percentage points.
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China’s foreign exchange reserves stood at $3.2tr at the end of September, according to the State Administration of Foreign Exchange. There was a decrease of $31.5bn from the previous month.
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The government of the Hong Kong Special Administrative Region plans to further expand the channels of cross-border flow of renminbi funds and develop offshore RMB products and tools, chief executive Carrie Lam said in her 2021 policy address this week. It also plans to allow stocks traded under the Stock Connect’s southbound link to be denominated in renminbi.
The government wants to assess the feasibility of developing the city into a regional carbon trading centre, Lam added. It will support co-operation between Hong Kong Exchanges and Clearing and the new Guangzhou Futures Exchange in developing financial products related to carbon emission trading.
Lam also vowed to engage with the Mainland to promote financial technologies and form a “one-stop sandbox network”, which will facilitate financial institutions and tech companies in Guangdong province and the Hong Kong and Macau SARs to test cross-border fintech applications.
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CST Group, a Hong Kong-listed investment holding company with subsidiaries operating in logistics and mining, on Thursday issued a profit warning related to investments in China Evergrande Group.
It expects to record “substantial loss” for the six months ended September 30 from its holding of Evergrande’s senior bonds and shares in its new energy vehicle (NEV) subsidiary, China Evergrande New Energy Vehicle Group. Based on the closing price on September 30, the bond-related loss will be worth around $135m. About $296m of losses will be related to Evergrande’s NEV business, CST said in a filing in Hong Kong.
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Orient Securities has obtained approval to offer mutual fund advisory services, according to onshore media reports.