China stocks subdued as tech shares rise, banks and insurers dip

HONG KONG: Chinese stocks were little changed on Monday as bank and insurer shares fell on Beijing’s capital-injection plan, while technology stocks gained. Broader markets were muted as investors watched developments in China-US relations. At the midday break, the Shanghai Composite index was down 0. 2% at 3, 920. 70 points, while the blue-chip CSI300 index was up 0. 2%. Tech sectors climbed as chip-related firms tracked US peers higher. The start-up board ChiNext Composite index was 2. 6% higher and Shanghai’s tech-focused STAR50 index rose 1. 6%. The chip sector rallied 2. 6% and the CSI 5G Communication Index was up nearly 5%, with heavyweight Zhongji Innolight jumping 8. 1%. However, the insurance sector declined 2. 5% and the banking sector lost 1. 5%, after China’s finance ministry said it will lead a combined $54 billion in capital injections into state-owned insurers and banks in a coordinated push by Beijing to shore up capital across its financial system. President Xi Jinping is preparing a large business delegation to accompany him on his visit to Washington, Reuters reported, an unusual move given US scepticism towards Chinese investment and Beijing’s strained ties with private enterprise. “Markets are likely to stay range-bound as external uncertainties have yet to fully ease, ” analysts at Nanhua Futures said in a note. Shifts in expectations for US interest rates will also be key for market direction this week, while defensive large-cap stocks are likely to remain relatively resilient, they added. In Hong Kong, the Hang Seng Index and the Hang Seng Tech Index were both down roughly 1%. Around the region, Asian shares rallied on Monday as a robust US jobs report was seen as positive for global growth, while oil edged higher after the US and Iran attacked ships in the Gulf. ‐Reuters

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