Chinese stocks went down after the base lending rate was kept the same

Chinese stocks went down after the base lending rate was kept the same

After the tumultuous session before, mainland Chinese stocks were tinged red in this morning session on October 21 when the basic lending interest rates were unchanged.

China’s Shanghai Composite Index fell 0.17% in the morning session of October 21. Photo: AFP

The mainland Chinese stock market this morning recorded the Shanghai Composite Index down 0.17% while the Shenzhen Component slipped 0.266%. In contrast, the Hong Kong Hang Seng Index rose 0.81%.

As predicted by many trade experts and analysts, China yesterday, October 20, announced that the basic lending interest rate for 1 year and 5 year terms remains unchanged. Currently, the basic lending rate for 1 year term in China is 3.85%, while the 5 year term lending rate is still at 4.65%.

The heat of the Japanese and Korean stock markets continued to be dominated by the negotiation of the new US economic stimulus package. In Japan, the Nikkei 225 index edged up 0.32% while the Topix index rose more sharply with 0.76%. Korean stocks this morning welcomed the green color with the Kospi index up 0.39%.

Meanwhile, there are not many waves on the Australian stock market when the S & P / ASX 200 index moved sideways 6,197.10 points. The MSCI Asia-Pacific Index (excluding Japan) increased 0.45%.

The group of Asia-Pacific aviation stocks this morning became the focus of attention when many major airlines recorded shares increase simultaneously. Significantly, shares of Cathay Pacific (Hong Kong) increased by more than 3% at the beginning of October 21 session. Previously, the airline announced it would lay off about 5,900 employees according to the restructuring schedule, while Cathay Dragon – a subsidiary of this airline – would also stop working from today.

“I think Cathay Pacific’s cost-cutting has been done on a large scale,” said Kelvin Lau, Head of Automotive, Transportation and Industrial Research at Daiwa Capital Markets, an investment advisory firm. The expert said that Cathay Pacific will have a “tighter cost structure in the future” although the airline’s restructuring costs and other damages increase in the short term.

Meanwhile, shares of Qantas Airways (Australia) increased 1.26%. Shares of Japanese airlines Japan Airlines and ANA Holdings rose 3.64% and 3.41%, respectively, while shares of Korean Air Lines (South Korea) rose to 2.93%. In Singapore, shares of Singapore Airlines also inched up 0.57%.

In the US, the progress of negotiating the new US economic stimulus package has shown positive signs as White House Chief of Staff Mark Meadows said that the administration of President Donald Trump and the Democratic Party on October 20 has achieved the Negotiations on the stimulus are progressed, but major differences remain.

According to Mr. Tapas Strickland, chief economist at Australia National Bank, if the new US economic stimulus package is not agreed before November (the time of the 2020 US presidential election), It is likely that this stimulus package will be passed after the election.

On the battle against Covid-19, the Wall Street Journal quoted Stephane Bancel, CEO of Moderna Biotechnology Company (USA) as saying preliminary results of the Covid-19 resistance vaccine test of this company expected The ants were announced in November. The CEO also petitioned the US Food and Drug Administration to license emergency vaccines by the end of this year.

Good signs on the new economic stimulus package negotiation brought US stocks up in the last trading session. The Dow Jones industrial average closed up 113.37 points, or 0.4%, to 28,308.79 points. The S&P 500 edged up 0.5 percent to close with 3,443.12 points while the Nasdaq Composite rose 0.3 percent to 11,516.49.

On the currency markets, the US dollar index against other major currencies fell to 93.01, from 93.6. The Japanese Yen appreciated and traded 105.38 JPY / USD against 105.6 JPY / USD, while the Australian dollar held the price compared to the beginning of the week and converted 1 AUD / 0.7066 USD.

Oil prices on the Asian market this morning fell on concerns about oversupply of oil in the world. Brent crude oil futures for this morning fell 0.63% to $ 42.89 / barrel while the US crude futures price slid 0.67% to $ 41.42 / barrel. Previously, the figures were due American Petroleum Institute announced that US crude oil reserves as of October 16 increased by 584,000 barrels to 490.6 million barrels.

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