April 24, 2019 / 5:12 AM / a month ago

China stocks fall as cenbank may likely hold broad monetary easing

SHANGHAI, April 24 (Reuters) - China stocks fell on Wednesday morning, amid new signs the central bank is putting on hold broad policy easing measures, dashing hopes for fresh large-scale liquidity pumps into the financial system.

** Hong Kong stocks also fell, despite Wall Street hitting fresh closing highs.

** The CSI300 index fell 0.9 percent to 3,984.71 at the end of the morning session, while the Shanghai Composite Index lost 0.9 percent to 3,169.20.

** The Hang Seng index dropped 0.9 percent to 29,709.45.

** The People’s Bank of China injected funds to select commercial banks via its targeted medium-term lending facility (TMLF) on Wednesday.

** The move reinforced views PBOC is likely to put any broader policy easing measures - such as reserve ratio cuts - on hold after recent signs of improvement in the world’s second-largest economy.

** “Monetary stimulus had been a key driver of the market rebound,” said Hu Yuanzhi, fund manager at Rationalstone Investment. “Now, we don’t expect strong loosening measures ahead, at least in the short to medium term.”

** The market was not helped by news that several Chinese fund managers have won regulatory approval to raise money for new funds targeting Shanghai’s Nasdaq-style technology board, which will be launched soon.

** Meanwhile, investors ignored fresh progress of the Sino-U.S. talks, with likelihood of a deal largely priced in U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin will travel to Beijing for trade talks beginning on April 30, the White House said in a statement on Tuesday.

** Chinese stocks fell across the board. China’s CSI300 financial sector sub-index was lower by 0.9 percent, the consumer staples sector down 1.15 percent, the real estate index down 0.67 percent and the healthcare sub-index down 0.77 percent.

** The smaller Shenzhen index was down 0.47 percent and the start-up board ChiNext Composite index was unchanged. ** Around the region, MSCI’s Asia ex-Japan stock index was weaker by 0.51 percent while Japan’s Nikkei index was down 0.45 percent. ** The yuan was quoted at 6.7236 per U.S. dollar, 0.06 percent firmer than the previous close of 6.7278. ** The largest percentage gainers on the main Shanghai Composite index were Hunan Corun New Energy Co Ltd, up 10.05 percent, followed by Shanghai Maling Aquarius Co Ltd , gaining 10.04 percent and Yangzhou Yaxing Motor Coach Co Ltd, up by 10.04 percent. ** The largest percentage losses on the Shanghai index were Greattown Holdings Ltd, down 10.01 percent, followed by Aurora Optoelectronics Co Ltd, losing 9.9 percent and Zhangjiagang Freetrade Science & Technology Group Co Ltd , down by 9.36 percent.

Reporting by Samuel Shen and John Ruwitch; Editing by Rashmi Aich

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