Global Economy Sees Boost Amid Interest Rate Cuts and RRR Reductions

Market Analysis

Wednesday, September 25, 2024

A combination of RRR cuts and interest rate cuts is expected to release trillions of dollars into the market, providing a much-needed boost to the economy. This move is anticipated to save 50 million households in Mainland China approximately 150 billion yuan in housing payments, thereby promoting consumer investment and increasing returns on A-share market value management.

Market Impact

The first installment of the unified second-home loan has been reduced to 15%, leading to a surge in Hong Kong stocks, with a 753-point increase, and a rebound of 19,000 points. A-shares also rose by 4%, benefiting from the central government’s bailout, marking the largest increase in more than 4 years.

Industry Updates

Brokerage firms have downplayed the purchase of Yonghui Miniso, which fell 24%. S&P has stated that the Bank of Hong Kong’s commercial real estate credit risk is controllable. Meanwhile, Cathay Pacific is set to launch a new flight service in April next year, and Dallas Passenger Transport has announced a significant development.

Global Economy

Mainland China is working to stabilize its economy, leading to high demand for copper prices over the past two months. Oil prices have risen by more than 2%, and iron ore has increased by 6%. Boeing has also raised wages by 30%, although the union has expressed dissatisfaction.

Expert Insights

Zhang Zhaocong has noted that insurance stocks have outperformed, with PICC being the strongest. Jiang Jing has expressed concerns that economic recovery may be a problem, while Liu Siming has advised capturing the rising trend of A-shares and buying China AMC CSI 300.

Real Estate Market

The largest sales after the interest rate cut have been reported, with YOHO Hub selling 120 units on Saturday and ONE JARDINE’S LOOKOUT selling 85 units in the first round on Saturday. HSBC has presumptively built the Ngau Chi Wan original nursing home project, and the owner of Fai Mansion’s 3-bedroom has sold for 40 million, with an expected loss of 25%.