24 Jul 2013
Flash: Chinese ban on wasteful construction – Deutsche Bank
FXstreet.com (New York) - The reaction in Chinese growth-sensitive assets has been relatively muted perhaps because market positioning had been fairly bearish to begin with and also on hopes of policy easing, notes Macro Strategy Analysts J. Reid and C. Tan at Deutsche Bank.
Key quotes
The Hang Seng has pared initial losses following the PMI release to be 0.3% lower on the day. The Shanghai Composite is down 1.3% and unsurprisingly mining companies, property developers and construction stocks are the main laggards.
Staying in China, “there is now a ban on government and Communist Party agencies from constructing new buildings for five years and told them to suspend projects that have already won approval as the country seeks to cut waste.”
Key quotes
The Hang Seng has pared initial losses following the PMI release to be 0.3% lower on the day. The Shanghai Composite is down 1.3% and unsurprisingly mining companies, property developers and construction stocks are the main laggards.
Staying in China, “there is now a ban on government and Communist Party agencies from constructing new buildings for five years and told them to suspend projects that have already won approval as the country seeks to cut waste.”