China's stock markets recover from global rout

On Friday, China’s stock market bounced back following positive trade data for the month of September, although Wall Street stock turmoil continues.

Buoyed by the rally of heavily weighted names like liquor maker Kweichow Mountai and financial conglomerate Ping An Group, the benchmark Shanghai Composite Index returned to stand above the 2,600 mark, advancing by 0.91 percent or 23.45 points to close at 2,606.91.

The smaller Shenzhen Component Index moved by 0.45 percent to finish at 7,558.28 points, while the Nasdaq-style ChiNext enterprise board inched up by 0.52 percent to 1,268.41.

China’s growth enterprise market plunged by a cumulative 10 percent from Monday to Friday, recording the biggest weekly loss since early 2016 when Chinese bourses launched the “circuit breaker” mechanism for the country's benchmark stock indexes.

Market watchers noted that the recovery of the A-share market was largely contributed to good news from China’s trade data. The latest statistics from the General Administration of Customs showed that during the first three quarters of 2018, China's import and export of goods totaled 22.28 trillion yuan (US$3.23 trillion), up by 9.9 percent over the same period last year.

ANZ Research said that the jump in China’s exports in September suggests a strong “front-loading effect” ahead of the implementation of an additional US$200 billion in tariffs, and they will watch for downside risks to the country’s exports in the last three months.

Overnight on Wall Street, stocks continued to dive for the second straight day, with the Dow Jones Industrial Average slipping by 545.91 points to finish the trading day at 25,052.83, and the S&P 500 shedding by 2.1 percent to end at 2,728.37.

Major banking names, iron and steel makers and cement companies led the rises, with shares of Ping An Bank, a Shenzhen-based joint-stock commercial lender, jumped by 4.46 percent to close at 10.30 yuan.

China Securities noted that the A-share market fell heavily yesterday due to multiple factors, and that the adjustment does not mean weakening of the country’s economic fundamentals. The stock broker advises investors not to show excessive panic over the market.