China Stocks Edged Higher, but Gains Were Limited

SHANGHAI, China – Chinese stock market ended significantly higher on Monday after more optimistic factory activity reports, but share gains were still limited because if the increasing anxiety over the developments on US-China trade discussions.

The blue-chip CSI 300 index was the top gainer for the Chinese stock market on Monday, with its recorded 0.2%, going up to 3,836.06. The Shanghai Composite index also recorded a modest 0.1% gains towards 2,875.81 points.

The modest gains for the Chinese shares came after the upbeat factory activity reports, recording its quickest pace of expanded activity in the past three years ago in November. A private business survey has shown the numbers on Monday with a more solid increased in both new orders and overall output.

It also followed the official data for November, showing the factory activity in the country, which took an unexpected growth for the first time after almost seven months. The growth in factory activity in China was mainly powered up as the domestic demand has picked up on the accelerated input measures in Beijing to help steady the growth.

According to a macro analyst at the Lianxun Securities, Zhang Deli, China is expected to have already passed the lowest point where the economy of the country hits the bottom for the short term.

Zhang said that the unexpected PMI for November is more likely brought by the boost on infrastructure investments and less on the property market control as well as the fairly quiet tension over the US-China trade negotiations.

Yi Gang, the central bank governor in China, also said in an article that was published on Sunday that China is expected to keep the normal monetary policy, given that the inflation is mild and the economic growth would remain in range.

However, market players are still on the edge of their seats, waiting on more concrete developments over the trade deal between the US and China, especially with the December 15 deadline on new Washington-imposed tariffs on Chinese products is looming over.

From a report on Sunday, phase one of the trade deal is currently on hold after the US President Donald Trump signed the Hong Kong bill to back the pro-democracy protesters in the embattled city, which has previously angered the Chinese government.

In other parts of Asia, the Asia ex-Japan index recorded a 0.23% increase with the Nikkei index of Japan closing Monday with 1.01% gains.

The Shanghai stock index also recorded a significant 15.3% increase with the CSI300 going for an additional 27.4%. Hong Kong-listed H-share of China also gained around 2.4%, and the A-shares ended Monday with 28.90%.