CBN丨Global investors look to Chinese equities as confidence improves

Hi everyone. I’m Stephanie LI.

Coming up on today’s program

• Chinese and Asian equitiesbecome more appealing as they stabilize amid trade tensions and Wall Street fallout;
• Ant Group begins cross-border trade operation centers in Guangzhou.

Here’s what you need to know about China in the past 24 hours

With rising strategic importance in terms of improving expectations and boosting confidence, China's capital market now provides opportunities for both Chinese and foreign investors as global economic growth stagnates due to Sino-US trade frictions.

The benchmark Shanghai Composite Index gained 0.25 percent today following a 0.45 percent rise on Monday. Hong Kong’s Hang Seng Index also added 0.8 percent on Tuesday.

This followed messages delivered during a State Council executive meeting on Friday, which included making continuous efforts to stabilize the stock market and advance the sound and stable development of the property sector. The implementation efficiency of the measures should be improved and their effect ensured, according to the meeting.

Meanwhile, foreign institutions have increased their holdings of Chinese yuan-denominated bonds since the start of this year. The size of the bond holdings of more than 1,160 foreign institutions rose 270 billion to 4.5 trillion yuan as of April 15 from the end of last year. China's bond market topped 183 trillion yuan to rank second in the world.

China's bond market has a strong appeal in terms of actual yield and hedge attributes, according to industry experts. With the overall improvement of China's economic performance, the fluctuation in the price of Chinese bonds is slight, with stable returns, they added.

Also in Asia, stock markets fought to hold their footing on Tuesday after a furious flight from US assets undermined Wall Street and the dollar.

U.S. stocks stumbled Monday as the Dow Jones Industrial Average fell 2.48 percent, while the S&P 500 sank 2.36 percent and the Nasdaq Composite Index shed 2.55 percent.

The loss of confidence in US assets took a heavy toll on the dollar which touched its lowest since March 2022 against a basket of currencies at 97.923 on Monday.

The fallout from Wall Street saw Japan's Nikkei ease a modest 0.3 percent, while MSCI's broadest index of Asia-Pacific shares outside Japan dipped 0.2 percent.

Relatively limited losses in Asia sparked talk that funds could be reallocating money to equities in the area, though the impact of tariffs on economic growth remained a major drag.

GBA express

• Ant Group's digital operation center in south China and Wanlihui cross-border trade operation center have settled in Guangzhou's Pazhou, the Chinese financial technology giant said at the Canton Fair yesterday. In early April, the group’s Alipay+ cross-border services upgraded the deep interconnection of electronic wallets in the Greater Bay Area, allowing users from the three regions to use Alipay, AlipayHK in Hong Kong and MPay in Macao to make payments and travel seamlessly across 11 cities in the area.
• Guangdong has introduced a new framework and guidance on artificial intelligence education for primary and secondary school students, aiming to boost students' AI literacy from an early age. The province will require at least six hours of AI education annually for students in grades one through four. Students in grades five and six, as well as those in junior high school, must complete no fewer than 10 hours per year. For senior high school students in grades one and two, the guidance mandates at least one AI class hour every two weeks.

Industry and company news

• China launched a tourism promotion campaign featuring over 6,000 beneficial measures for tourists nationwide yesterday, with over 1 billion yuan of subsidies to be provided by more than 60 cooperative entities. The campaign will run through May 31.
• China's auto exports jumped 16 percent to 1.54 million units in the first quarter of the year from the same period last year, CPCA Secretary-General Cui Dongshu said today. In March alone exports reached 570,000 units, up 16 percent from a year earlier.
• Meituan cannot restrict delivery riders from picking orders on multiple platforms, the Chinese food delivery giant said yesterday, after newcomer JD.Com claimed earlier that some rivals forced part-time delivery riders to work only for one platform. Riders from Meituan, Ele.me, FlashEx, and others work for several platforms, Meituan added.
• Dubai’s Roads and Transport Authority teamed up with Baidu's Apollo Go to begin trial operation of 50 driverless vehicles in the UAE in the next few months, hoping to officially launch robotaxi services next year, according to the Dubai Media Office. Baidu will deploy its latest-generation autonomous vehicle RT6, gradually expanding the scale of its local fleet to 1,000 over the next three years.
• China's second-hand platform Xianyu yesterday unveiled a support scheme for small and medium Chinese exporting firms and merchants, including measures to help them quickly open accounts, reach new sales channels, and explore the domestic market.
• China on Monday issued a guideline policy to further enhance the country's pilot free trade zones. The guideline calls for comprehensively enhancing the level of institutional openness, the effectiveness of systematic reforms and the quality of an open economy in the pilot free trade zones in the next five years and further improving the policy system, focusing on the free and convenient flow of trade, investment, capital, transportation and personnel, and the orderly flow of data with an emphasis on security.
• China’s Ministry of Education on Tuesday announced an updated undergraduate program catalogue, adding 29 new majors in emerging sectors such as artificial intelligence (AI) and low-altitude economy, which will be included in this year’s gaokao, according to an official statement.

Asia-Pacific highlights

• Foreign Ministers and Defense Ministers of China and Indonesia on Monday co-chaired the First Ministerial Meeting of China-Indonesia Joint Foreign and Defense Ministerial Dialogue. The two sides vowed to deepen strategic mutual trust, maintain close high-level exchanges, enhance cooperation in fields such as defense and security and jointly safeguard regional peace and stability.
• The eighth batch of emergency humanitarian aid supplies dispatched by the Chinese government on Tuesday arrived at Yangon International Airport in Myanmar, which was devastated by a 7.9-magnitude earthquake on March 28.

Executive Editor: Sonia YU

Editor: LI Yanxia

Host: Stephanie LI

Writer: Stephanie LI

Sound Editor: Stephanie LI

Graphic Designer: ZHENG Wenjing, LIAO Yuanni

Produced by 21st Century Business Herald Dept. of Overseas News.

Presented by SFC