Stimulus bets drive Chinese stocks higher before key meeting

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Stimulus bets drive Chinese stocks higher before key meeting

stock :: 2024-11-29 :: source - bloomberg

By Bloomberg News

(Bloomberg) — Chinese stocks rallied for the second time this week with traders pointing to expectations for greater economic support at a key policy meeting in December.

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The CSI 300 (000300.SS) Index jumped as much as 2.3% on Friday, its biggest gain in three weeks. Technology, health-care and consumer staples sectors led the advance. A Bloomberg Intelligence gauge of Chinese developer shares rose more than 3%.

Speculation that authorities will release further stimulus is simmering ahead of the Central Economic Work Conference. The meeting by Chinese top leaders lays out economic priorities for the coming year. With Donald Trump’s election posing significant risks to growth, investors are pinning their hopes on Beijing to counter any impact from escalated trade tensions.

“There are all sorts of rumors flying around in Chinese social media,” said Nigel Peh, a fund manager at Timefolio Asset Management in Singapore, adding that the speculations include the launch of a stabilization fund, a reduction in the required reserve ratio and an addition of housing prices to local governments’ performance metrics.

On Wednesday, a rebound in Chinese stocks accelerated in afternoon trading and pushed the benchmark up 1.7% at the close. Investors pointed to an unverified screenshot circulated in online chat groups showing that the CEWC will be held earlier than expected and set the 2025 fiscal deficit target at a higher-than-usual ratio.

While top leaders are expected set targets for gross domestic product growth, the fiscal deficit and inflation at the meeting, the results are typically released at the legislative session in March.

—With assistance from John Cheng.