Everything You Need to Know About China's Economy on Tuesday (June 18)

Your Daily & Trustworthy Updates on the Chinese Economy

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Good Tuesday! This is TIAN in Kuala Lumpur.

Welcome to monitor the pulse of China’s economy together with me.

DRIVING THE DAY, KPMG Cuts Hong Kong IPO Forecast by 40% Blaming Fed Rate Cuts Delay, Caixin Media reported.

• KPMG downgraded its expectations for Hong Kong’s initial public offering (IPO) market this year, citing a global decline in dealmaking.

• The accounting and consulting firm now expects up to 80 new listing, raising a total of HK$60 billion ($768 million), down 40% from its earlier estimate.

• In the first half of 2024, the Hong Kong IPO market raised a total of HK$11.6 billion across 27 deals, representing a decrease of 35% and 15% in funds and deal volume compared with the first half of 2023.

MEANWHILE,  as of the end of May, China had erected 9.92 million chargers throughout the country, marking a 56 percent year-on-year expansion, Li Chao, an official from the National Development and Reform Commission (NDRC), told a press conference on Tuesday.

• Among them, public charging facilities totaled 3.05 million units, up 46 percent year on year, while the number of private charging facilities climbed 61 percent to about 6.87 million units, according to Li.

• The country aims to add 3,000 charging piles and 5,000 charging parking spaces in highway service areas this year.

ALSO ON TUESDAY, Chinese authorities have earmarked 443 million yuan (about 62.26 million U.S. dollars) of disaster relief funds to assist drought control and agricultural production in a broad swath of the country.

• The funds will be used to support drought prevention and control work in the provinces of Hebei, Shanxi, Jiangsu, Anhui, Shandong, Henan, and Shaanxi, according to a statement released on the Ministry of Finance's website on Tuesday.

• Sweltering heat baked parts of China, resulting in soil moisture loss and having an adverse impact on seed sowing and crop growth in summer, according to the statement.

• The ministry said the allocated funds will be channeled to support anti-drought measures in disaster-affected regions such as replenishing soil moisture, replanting new crops and applying fertilizer.

IN TODAY'S FINANCIAL MARKET,

Shanghai Composite Index Rose 0.48% on Tuesday

• China’s benchmark Shanghai Composite Index (000001.SH) gained 0.48% on Tuesday, while the Shenzhen Component Index (399001.SZ) rose 0.4%.

• Shanghai’s tech-heavy STAR 50 Index (000688.SH) ended nearly flat for the day, while Shenzhen’s similar ChiNext Index (399006.SZ) rose 0.29%.

China's benchmark interbank gold prices higher Tuesday

• According to the China Foreign Exchange Trade System, the benchmark price for gold that is 99.95 percent pure or above stood at 548.21 yuan (77.21 U.S. dollars) per gram, 0.91 yuan higher than the previous trading day.

• The price for gold that is 99.99 percent pure or above went up 1.09 yuan from the previous trading day to 547.33 yuan.

• Spot transaction prices on the interbank price inquiry market are allowed to rise or fall within 15 percent from the benchmark prices each trading day.

Chinese yuan strengthens to 7.1148 against USD Tuesday

• The central parity rate of the Chinese currency renminbi, or the yuan, strengthened 1 pips to 7.1148 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.

China's central bank adds liquidity via reverse repos

• China's central bank conducted 86 billion yuan (12.11 billion U.S. dollars) of seven-day reverse repos at an interest rate of 1.8 percent Tuesday.

• The move aims to keep liquidity reasonable and ample in the banking system, the People's Bank of China said in a statement.

Hong Kong's Hang Seng Index closes 0.11 pct lower

• Hong Kong's stock market ended lower on Tuesday with the benchmark Hang Seng Index down 0.11 percent to close at 17,915.55 points.

• The Hang Seng China Enterprises Index dipped 0.08 percent to end at 6,368.1 points and the Hang Seng Tech Index fell 0.33 percent to close at 3,697.21 points.

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 130 yuan (about 18.27 U.S. dollars) to close at 14,490 yuan per tonne.

• On Tuesday, the total trading volume for six listed cotton futures contracts on the ZCE was 558,591.0 lots with a turnover of 40.45 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 202 yuan (28.39 U.S. dollars) to close at 6,004 yuan per tonne.

• On Tuesday, the total trading volume for six listed sugar futures contracts on the ZCE was 1,058,113.0 lots with a turnover of 64.04 billion yuan.

Iron ore futures closed higher on Tuesday in daytime trading at the Dalian Commodity Exchange.

• The most active iron ore contract for September 2024 delivery gained 2 yuan (about 28 U.S. cents) to close at 820.5 yuan per tonne.

• On Tuesday, the total trading volume of 12 listed iron ore futures contracts on the exchange was 575,010 lots, with a turnover of about 47.26 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 July 2024 delivery dipped 21 yuan (about 2.95 U.S. dollars) to close at 4,506 yuan per tonne.

• On Tuesday, the total trading volume of six listed No.1 soybean futures contracts on the exchange was 119,572 lots, with a turnover of about 5.43 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.