S&P 500 Marks Significant High
Wall Street ended sharply higher yesterday with Tesla, Nvidia and other megacap growth stocks leading the way after a drop in monthly job openings cemented expectations of a pause in interest rate hikes by the U.S. Federal Reserve.
Oil Prices Rise On Large U.S. Stockpile
Oil prices extended gains today after industry data showed a large draw in crude inventories in the U.S., the world’s largest fuel consumer, and concerns about a hurricane in the Gulf of Mexico is keeping investors on edge.
Toyota Restarts Japan Production After System Failure
Toyota Motor (7203.T) will restart operations at its assembly plants in Japan today, after a production system malfunction brought domestic output to a halt at the world’s largest-selling automaker.
Today’s News
The largest banks in China are preparing to cut interest rates on existing mortgages and deposits as a part of the latest state-directed measures to shore up growth in the world’s second-largest economy.
Sources also claimed that the big state-owned lenders are working on reducing rates on the majority of the nation’s 38.6 trillion yuan (USD 5.3 trillion) of outstanding mortgages, according to people familiar with the matter. The reductions will only affect loans on first homes. Lenders such as Industrial & Commercial Bank of China Ltd. and China Construction Bank Corp. are simultaneously poised to cut deposit rates later this week for the third time of the year.
These moves are part of a targeted push by Beijing to stimulate consumer spending, drive funds into the stock market and alleviate pressure on lenders’ profit margins.
While China shares gained in offshore trading, it remains unclear whether the moves will be enough to spark a sustained revival in investor confidence. Authorities have so far avoided broader stimulus measures despite a deepening property crisis and growing deflation pressures that have put the government’s economic growth target at risk.
Other reports include:
China Pledges To Boost Economy
China has publicly pledged to strengthen its policy support and speed up government spending as the economy’s recovery is hindered by its property crisis and growing deflation.
Finance Minister Liu Kun and Zheng Shanjie, chairman of the National Development and Reform Commission, made the pledges in reports to the country’s legislature on Monday, according to the official Xinhua News Agency.
China’s Largest Bank Approaches Record Low
Industrial & Commercial Bank of China Ltd. is trading near an all-time record low valuation, with its shares down by 11% so far this year in Hong Kong due to rising concerns over margins and asset quality ahead of its first-half results due later today.
China’s biggest lender is likely to report slower earnings growth, dragged by weak margins and fee income, sources claimed.
Jingwei Has Sights Set To Delist
The largest shareholder of the Chinese trust firm at the heart of the country’s shadow banking crisis plans to delist its shares due to “significant uncertainties,” raising more concerns about financial contagion in the economy.
Jingwei Textile Machinery Co. said in a filing yesterday that it plans to pull its shares from the Shenzhen stock exchange, a rare move by a central government-backed enterprise. The company also cited “market changes” for the move as it aims to protect the interests of smaller shareholders.
