China stocks recover from early losses on cautious PBOC policy tone
Mainland stocks closed higher after paring earlier losses as investors read the central bank’s latest messaging as supportive but restrained
The broad-based CSI 300 Index added 0.2 per cent to 4,642.54 by the close, after briefly trading lower in the session. The Shanghai Composite Index rose 0.5 per cent. Hong Kong’s market was closed on Thursday and Friday for the Christmas holiday.
Among the notable gainers, electrical solutions provider Sieyuan Electric rose 3.3 per cent to 154.73 yuan, and insurer Ping An Insurance added 2.6 per cent to 70.80 yuan. Chinese baijiu maker Kweichow Moutai rose 1 per cent to 1,414.17 yuan and peer Luzhou Laojiao added 0.7 per cent to 120.72 yuan.
Among major losers, battery maker Contemporary Amperex Technology (CATL) fell 0.7 per cent to 373.01 yuan, while biopharmaceutical firm Sichuan Biokin Pharmaceutical declined 3.2 per cent to 331 yuan, and printed circuit boards producer Shennan Circuits dropped 2.1 per cent to 224.50 yuan. Home-grown chipmaker Semiconductor Manufacturing International Corporation (SMIC) slid 0.3 per cent to 123.08 yuan.
Investors continued to digest signals of measured policy support from China’s central bank, which struck a supportive but restrained tone on monetary easing, reinforcing expectations that any stimulus would be incremental rather than aggressive.
In a statement released on Wednesday after its fourth-quarter monetary policy committee meeting, the People’s Bank of China said it would continue to guide borrowing costs to remain at relatively low levels and reiterated its commitment to so-called “cross-cyclical” adjustments.