(Bloomberg) — Chinese stocks gave back earlier gains as a much-anticipated joint ministry briefing on supporting the property market offered few recent stimulus measures.
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The CSI 300 Index was down 0.1% as of 11:18 a.m., reversing a 1.3% rise. A Bloomberg Intelligence gauge of Chinese developer stocks tumbled greater than 8%. The Hang Seng China Enterprises Index trimmed its advance to lower than 1%.
China will expand a program to support “white list” projects to 4 trillion yuan ($562 billion) from about 2.23 trillion yuan already deployed, Housing Minister Ni Hong said, in a number of the most concrete remarks within the press briefing. That’s after a newspaper run by the housing ministry had hinted Beijing will “hit a heavy punch combo,” setting market expectations high.
The market response suggests authorities face a high bar to satisfy traders and revive a faltering rally. Skepticism has been creeping back in as Beijing fell in need of unleashing fiscal firepower that matches the surprise offered by the central bank’s policy blitz in late September. Thursday’s briefing may end as one other let-down after those by the Ministry of Finance and the state economic planner triggered wild market swings with scant spending details earlier this month.
“Equity investors are searching for big headline numbers to drive stocks up further, while the federal government is more focused on bringing the economy and housing markets steadily back to health,” said Vey-Sern Ling, managing director at Union Bancaire Privee. “So long as there’s such a mismatch in expectations, all press briefings will inevitably be disappointing.”
Data due Friday is ready to indicate the economy expanded 4.5% within the third quarter from a yr ago, in line with economists surveyed by Bloomberg. That may be the least since March 2023, intensifying a debate as as to if the stimulus measures announced to this point shall be enough to show across the moribund economy.
Some investors are waiting for the second leg of the rally to resume because the CSI 300 Index heads for a correction. A delay in market revival would seem to be a deja vu to traders who’ve been burnt by multiple false dawns over the past few years.
“While it can’t be said that no recent policy measures have been introduced in any respect, they will hardly make the market feel any real breakthrough has been made,” said Shen Meng, a director at Beijing-based boutique investment bank Chanson & Co. “Investor confidence continues to shrink and the sentiment stays low, which can add pressure for Beijing to ramp up policy support in the longer term.”
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