China Economic Scan - Your daily update on the Chinese economy.
In this edition: Chinese fixed asset investment climbs 30.5%, ports refocus on domestic cargo to drive earnings, Bank of China to lend 20 bln yuan to COSCO, Jien Nickel buys 19.95% of Aus based Metallica Minerals, Chinese stocks rebound on investment figures.
Top 5 headlines
Chinese Investment Climbs 30.5% on Stimulus Plan, Surging Loans
- China’s urban fixed-asset investment climbed 30.5% in the first four months from a year earlier compared with a 28.6% increase in the first three months and analyst estimates of 29.1%.
- “Fixed-asset investment is the most important driver for economic growth this year,” said Sun Mingchun, chief China economist at Nomura Holdings.
- Lowering the capital ratio by an average of 6 percentage points could save local governments and private investors more than 1 trillion yuan a year, noted Lu Zhengwei, Shanghai-based chief economist at Industrial Bank Co.
Ports pin hopes on rising domestic trade
- "This year is the most difficult one for us and we have been continuously taking measures to stimulate cargo throughput for domestic market," Sun Junmin, public relations director, Shenzhen Yantian Port
- Chinese foreign trade has been dwindling since last November and in April, exports and imports dropped 22.6 and 23% year-on-year respectively.
- In April, the cargo and container throughput handled by Tianjin port surged 2.02 and 5.3% respectively year-on-year, largely due to the growth in domestic business, which respectively grew by 14.4, and 42.1% from a year earlier.
BOC grants 20b yuan in loans to shipping firm
- Bank of China (BOC) Shanghai branch recently approved syndicated loans worth nearly 20 billion yuan ($2.93 billion), which will be provided to COSCO Container Lines Co Ltd (COSCON) in the next three years.
- BOC Shanghai branch will grant a credit line of $1.75 billion in the coming two years for the construction and operation of 28 COSCON container vessels.
- It will offer $1 billion in liquidity loans in the next 3 years to help cover COSCON's operating costs.
Jien Nickel buys 19.95% of Australia's Metallica Minerals
- Jien Nickel, one of China's leading nickel producers, said in a filing to the Shanghai Stock Exchange that it is now the largest shareholder of Australia's Metallica Minerals, after buying 19.95 percent of the company with A$5.16 million ($3.93 million).
- The company bought 22.85 million shares of the Metallica Minerals at a price of A$0.2259 per share.
- Earlier in April, Jien Nickel announced raising 1.1 billion yuan ($161 million) from the market, with 600 million to be invested in mines in Canada and Papua New Guinea.
China shares rebound on stronger investment data
- Chinese stocks rebounded on Tuesday with positive econ news boosting the market; Hang Seng +0.38% to 17,154, Shanghai Composite +1.49% to 2,618, Shenzhen Component +3.14% to 10,179.
- China Vanke, the country's biggest developer, and SZSE's largest company, up +6.7% to 10.46 yuan, while rival Poly Real Estate Group rose +6.1% to 22.19 yuan.
- Steel producers were buoyed by rising steel prices. Baoshan Iron & Steel jumped +6.3% to 6.55 yuan while Xinjiang Bayi Iron & Steel advanced +6% to 9.6 yuan.
Financial Indicators:
| Metric | Value | Point change | % change |
| Hang Seng Index | 17,154 | 65.69 | 0.38% |
| Shanghai Composite | 2,618 | 38.42 | 1.49% |
| Shenzhen Component | 10,179 | 310.36 | 3.14% |
| TAIEX | 6,433 | -214.95 | -3.23% |
| CNY/USD | 6.8260 | -0.002 | -0.03% |
Source: China Economic Scan
