ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronEye IconIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintSite TitleTitle ChevronIcon Twitter
Nikkei Markets

Asian stocks advance as Chinese central bank cuts reserve ratio

China Construction Bank, Agricultural Bank of China lead mainland lenders higher

HONG KONG (Nikkei Markets) -- The Nikkei gauge for Asian shares outside of Japan rose Thursday, led by mainland companies after the People's Bank of China cut the amount of reserve lenders must set aside.

The Nikkei Asia300 index added 0.6% to close at 1,398.60.

The CSI 300 Index jumped 1.4% on Thursday and an index of Chinese companies listed in Hong Kong gained by a similar margin after China's central bank yesterday cut the reserve requirement ratio (RRR) for financial institutions by 50 basis points with effect from next Monday.

Morgan Stanley said Chinese equities will be supported by the PBoC's RRR cut and the progress on the U.S.-China phase-one deal.

"This is consistent with our more positive view for 2020 market outlook based on our expectation of reduced external uncertainties and earlier macro bottoming out," Morgan Stanley said in a note. "We see good chance of indices breaking or overshooting our base case target prices in the near term (4,180 for CSI300)."

The phase-one trade agreement reached between the U.S. and China last month will be signed at the White House on Jan. 15, President Donald Trump said earlier this week.

Meanwhile, data released earlier on Thursday showed that manufacturing activity in China in December continued to expand. The Caixin December manufacturing PMI (Purchasing Managers' Index) posted a reading of 51.5 compared with 51.8 in the previous month and below the estimates of economists polled by Reuters.

China Construction Bank and Agricultural Bank of China led mainland lenders higher on Thursday, adding at least 1% each. Chinese technology conglomerate Tencent Holdings rose 1.8%.

Property developer China Vanke jumped 3.3% and China Overseas Land & Investment climbed 1.2%. Guangzhou Automobile Group advanced 1.4%.

Hong Kong-listed casino operators Galaxy Entertainment Group jumped 5.7% and Sands China rose 2.6% after Macau's casino gross gaming revenue in December declined 13.7%. The drop was at the top end of intra-month estimates and better than the consensus decline of 15%, and therefore positive, Jefferies said in a note.

Bajaj Auto declined 0.7% after the Indian motorcycle maker said total domestic sales volume declined 15% in December from a year ago. Tata Motors added 5.1% despite a 12% decline in sales in the month.

--Nimesh Vora

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Try 1 month for $0.99

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends July 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media