Everything You Need to Know About China's Economy on Tuesday (Aug. 6)
Your Daily & Trustworthy Updates on the Chinese Economy
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Good Tuesday! This is TIAN in Beijing.
Welcome to monitor the pulse of China’s economy together with me.
DRIVING THE DAY, central China's Henan Province has launched a new cargo air service linking its capital city of Zhengzhou with Paris, France.
A freighter jointly operated by China Gate Logistics and France's CMA CGM Air Cargo, loaded with over 50 tonnes of e-commerce goods of various categories, has left Zhengzhou Xinzheng International Airport for Paris, according to the airport.
The service will run five times each week, on Mondays, Tuesdays, Wednesdays, Fridays and Saturdays.
MEANWHILE, XPeng’s Flying Car Unit Secures $150 Million Fresh Funding to Start Mass Production.
XPeng Aeroht, the flying car subsidiary of Chinese electric carmaker XPeng Inc., has secured $150 million in a new funding round as the company pushes forward to start mass production.
XPeng Aeroht hasn’t named the investors in the latest funding round but Caixin learned that the financing was coordinated by the Guangzhou government, with at least three state-owned companies participating. XPeng Aeroht’s post-investment valuation exceeds $1 billion, sources told Caixin.
Guangzhou GET Investment Holdings Co. Ltd., a subsidiary of Guangzhou Development District Holding Group Co. Ltd, made the largest investment of $70 million, Caixin learned. Two other Guangzhou government-backed firms invested $50 million and $30 million, respectively.
Zhao Deli, founder of XPeng Aeroht, said the proceeds will be used for the research and development and mass production of the company’s flying cars, ensuring the smooth realization of commercialization.
XPeng Aeroht plans to start pre-sales in the fourth quarter and expects to begin mass production in the fourth quarter of 2025, according to Zhao.
The company is to build a flying car manufacturing plant in the Guangzhou Development Zone. This will initially be used to produce the flight module of the modular flying cars, the company said.
ALSO ON TUESDAY, State-Backed Leasing Firm Misses $55.9 Million Bond Payment.
Shanghai Industrial Financial Leasing Co. Ltd., a state-backed leasing firm and a major funding source for local government financing vehicles, has missed the interest and principal payments on a 400-million-yuan ($55.9 million) private placement bond, highlighting the company’s deepening debt woes, Caixin reported.
On Aug. 1 the company warned it might be unable to repay a bond maturing on Aug. 3 after negotiations to secure bondholders’ support for an extension failed. With a coupon rate of 7.00%, the total principal and interest due is 428 million yuan. Since Aug. 3 falls on a weekend, the actual payment date is Aug. 5.
IN TODAY'S FINANCIAL MARKET,
Shanghai Composite Index Rose 0.23% on Tuesday
China’s benchmark Shanghai Composite Index (000001.SH) gained 0.23% on Tuesday, while the Shenzhen Component Index (399001.SZ) rose 0.82%.
Shanghai’s tech-heavy STAR 50 Index (000688.SH) gained 1.36% for the day, while Shenzhen’s similar ChiNext Index (399006.SZ) rose 1.25%.
China's benchmark interbank gold prices lower Tuesday
According to the China Foreign Exchange Trade System, the benchmark price for gold that is 99.95 percent pure or above stood at 561 yuan (about 78.66 U.S. dollars) per gram, 9.55 yuan lower than the previous trading day.
The price for gold that is 99.99 percent pure or above went down 10.47 yuan from the previous trading day to 560.7 yuan.
Chinese yuan strengthens to 7.1318 against USD Tuesday
The central parity rate of the Chinese currency renminbi, or the yuan, strengthened 27 pips to 7.1318 against the U.S. dollar Tuesday, according to the China Foreign Exchange Trade System.
In China's spot foreign exchange market, the yuan is allowed to rise or fall by 2 percent from the central parity rate each trading day.
Hong Kong's Hang Seng Index closes 0.31 pct lower
Hong Kong stock market ended lower Tuesday with the benchmark Hang Seng Index down 0.31 percent to close at 16,647.34 points.
The Hang Seng China Enterprises Index fell 0.41 percent to end at 5,852.61 points, and the Hang Seng Tech Index rose 0.09 percent to 3,342.52 points.
China's central bank conducts reverse repos Tuesday
China's central bank conducted 620 million yuan (about 87 million U.S. dollars) of seven-day reverse repos at an interest rate of 1.7 percent Tuesday.
The move aims to keep liquidity reasonable and ample in the banking system, the central bank said.
AT THE END OF TODAY'S SHARING, LET'S TAKE A LOOK AT YOUR DAILY FUTURES:
Cotton futures closed lower Tuesday in daytime trading on the Zhengzhou Commodity Exchange (ZCE).
The most active cotton contract for September 2024 delivery lost 440 yuan (about 61.7 U.S. dollars) to close at 13,655 yuan per tonne.
On Tuesday, the total trading volume for six listed cotton futures contracts on the ZCE was 689,791 lots with a turnover of 47.62 billion yuan.
Sugar futures closed lower Tuesday in daytime trading on the Zhengzhou Commodity Exchange.
The most active sugar contract for September 2024 delivery lost 24 yuan (3.37 U.S. dollars) to close at 6,125 yuan per tonne.
On Tuesday, the total trading volume for six listed sugar futures contracts on the ZCE was 300,346.0 lots with a turnover of 18.11 billion yuan.
Iron ore futures closed lower on Tuesday in daytime trading at the Dalian Commodity Exchange.
The most active iron ore contract for January 2025 delivery dipped 11 yuan (about 1.54 U.S. dollars) to close at 763 yuan per tonne.
On Tuesday, the total trading volume of 11 listed iron ore futures contracts on the exchange was 636,282 lots, with a turnover of about 49.08 billion yuan.
No.1 soybean futures closed lower on Tuesday in daytime trading at the Dalian Commodity Exchange.
The most active No.1 soybean contract for September 2024 delivery dipped 20 yuan (about 2.8 U.S. dollars) to close at 4,586 yuan per tonne.
On Tuesday, the total trading volume of six listed No.1 soybean futures contracts on the exchange was 127,889 lots, with a turnover of about 5.8 billion yuan.
About the Newsletter:
Ran by TIAN Dongdong, this newsletter features daily, trustworthy content on China's economy and regularly updates the insights of Chinese youth on Sino-US relations. Having worked in Brussels, London, Cairo, and Tripoli for Chinese media as correspondent for several years, TIAN is now based in Beijing.