Everything You Need to Know About China's Economy on Wednesday (Sept. 11)
Your Daily & Trustworthy Updates on the Chinese Economy
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Good Wednesday. This is TIAN in Beijing.
Welcome to monitor the pulse of China’s economy together with me.
DRIVING THE DAY, China's top 500 enterprises posted steady performance last year with rising revenue and a greater focus on innovation, an industrial ranking report showed.
The 2024 list of the top 500 Chinese enterprises was published by the China Enterprise Confederation (CEC) and the China Enterprise Directors Association.
The 500 largest companies generated combined revenues of 110.07 trillion yuan (15.46 trillion U.S. dollars) in 2023, up 1.58 percent year on year. Their net profits totaled 4.51 trillion yuan last year, up 5.01 percent from one year earlier.
Wang Jiming, vice president of the CEC said China's top 500 enterprises outperformed the Fortune Global 500 companies in both revenue and profit growth during the cited period.
Companies on this year's Fortune Global 500 list saw their revenue rise 0.1 percent and profits up 2 percent year on year in 2023, according to figures released last month.
Wang, also an academician of the Chinese Academy of Engineering, said that the revenue threshold for entry on the list of top 500 Chinese enterprises has increased for 22 consecutive years, reaching 47.38 billion yuan this year, an increase of 383 million yuan over the previous year.
Wednesday's data also showed that the average research and development (R&D) intensity of top 500 Chinese enterprises has increased for the seventh consecutive year. Their total R&D spending accounted for 1.9 percent of the combined revenue, the highest level since 2002.
Additionally, the list featured a growing number of companies from advanced manufacturing and modern services sectors, underscoring their role in driving China's economic transformation.
A total of 31 companies from sectors of new energy equipment manufacturing, power and energy storage batteries, communication equipment and computer manufacturing, and semiconductor and panel manufacturing were included in this year's list, an increase of 18 companies over the past five years.
MEANWHILE, Chinese Banks’ Cash Flow Plummets After Crackdown on High Deposit Rates, Caxin Media reported.
Chinese banks are under strain as their deposits shrink in the wake of a regulatory crackdown on offering deposit rates higher than regulatory caps.
In the first half of the year, many Chinese mainland-listed commercial banks saw a decline in their net cash flow generated from operating activities — a key indicator of lenders’ liquidity — Caixin calculations based on their interim reports show.
ALSO ON WEDNESDAY, over 3,000 enterprises are expected to attend the upcoming 21st China-ASEAN Expo in Nanning, south China's Guangxi Zhuang Autonomous Region, according to information revealed at a press conference.
Scheduled from Sept. 24 to 28, the expo boasts an exhibition area of nearly 200,000 square meters this year, with Malaysia as the country of honor, said Tan Pichuang, vice chairman of Guangxi Zhuang Autonomous Region.
The United Arab Emirates will be a Special Partner Country, the first time the expo has invited a Gulf Cooperation Council member to participate.
IN TODAY'S FINANCIAL MARKET,
Shanghai Composite Index Fell 0.82% on Wednesday
China’s benchmark Shanghai Composite Index (000001.SH) lost 0.82% on Wednesday, while the Shenzhen Component Index (399001.SZ) rose 0.39%.
Shanghai’s tech-heavy STAR 50 Index (000688.SH) gained 0.65% for the day, while Shenzhen’s similar ChiNext Index (399006.SZ) rose 1.19%.
China's benchmark interbank gold prices higher Wednesday
According to the China Foreign Exchange Trade System, the benchmark price for gold that is 99.95 percent pure or above stood at 571 yuan (about 80.22 U.S. dollars) per gram, 2.6 yuan higher than the previous trading day.
The price for gold that is 99.99 percent pure or above went up 2.46 yuan from the previous trading day to 572.72 yuan.
Chinese yuan weakens to 7.1182 against USD Wednesday
The central parity rate of the Chinese currency renminbi, or the yuan, weakened 46 pips to 7.1182 against the U.S. dollar Wednesday, 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 0.73 pct lower
Hong Kong's stock market ended lower Wednesday with the benchmark Hang Seng Index down 0.73 percent to close at 17,108.71 points.
The Hang Seng China Enterprises Index fell 0.73 percent to end at 5,982.55 points, and the Hang Seng Tech Index rose 0.01 percent to end at 3,450.92 points.
China's central bank conducts reverse repos Wednesday
China's central bank conducted 210 billion yuan (about 29.5 billion U.S. dollars) of seven-day reverse repos at an interest rate of 1.7 percent Wednesday.
The move aims to keep liquidity reasonable and ample in the banking system, the People's Bank of China said in a statement.
AT THE END OF TODAY'S SHARING, LET'S TAKE A LOOK AT YOUR DAILY FUTURES:
Cotton futures closed higher Wednesday in daytime trading on the Zhengzhou Commodity Exchange (ZCE).
The most active cotton contract for January 2025 delivery gained 110 yuan (about 15.45 U.S. dollars) to close at 13,465 yuan per tonne.
On Wednesday, the total trading volume for six listed cotton futures contracts on the ZCE was 439,113 lots with a turnover of 29.25 billion yuan.
Sugar futures closed higher Wednesday in daytime trading on the Zhengzhou Commodity Exchange.
The most active sugar contract for January 2025 delivery gained 25 yuan (about 3.51 U.S. dollars) to close at 5,645 yuan per tonne.
On Wednesday, the total trading volume for six listed sugar futures contracts on the ZCE was 322,620 lots with a turnover of 18.15 billion yuan.
Iron ore futures closed higher on Wednesday in daytime trading at the Dalian Commodity Exchange.
The most active iron ore contract for January 2025 delivery gained 7.5 yuan (about 1.05 U.S. dollars) to close at 694 yuan per tonne.
On Wednesday, the total trading volume of 12 listed iron ore futures contracts on the exchange was 736,993 lots, with a turnover of about 50.12 billion yuan.
No.1 soybean futures closed higher on Wednesday in daytime trading at the Dalian Commodity Exchange.
The most active No.1 soybean contract for January 2025 delivery gained 8 yuan (about 1.12 U.S. dollars) to close at 4,302 yuan per tonne.
On Wednesday, the total trading volume of five listed No.1 soybean futures contracts on the exchange was 90,958 lots, with a turnover of about 3.9 billion yuan.
About the Newsletter:
Ran by TIAN Dongdong, this newsletter features daily, trustworthy content on China's economy. Having worked in Brussels, London, Cairo, and Tripoli for Chinese media as correspondent for several years, TIAN is now based in Beijing.