More insight on the China GDP

Chinese equities extended their declines after the nation reported slower growth in the third quarter, with markets there underperforming compared with broad gains across the Asia-Pacific region.

Data released Thursday showed China’s economic expansion slowed to 6.8% in the third quarter, down from 6.9% in the second quarter, as Beijing’s efforts to clamp down on off-balance sheet lending and corporate leverage weighed on growth.

Both the Shanghai Composite Index and the Shenzhen main board were last down 0.4%. In Hong Kong, the Hang Seng Index was down 0.1%, after opening higher.

While the third-quarter growth numbers met expectations, markets were nonetheless positioned for an upside surprise, after Chinese central bank Gov. Zhou Xiaochuan predicted the economy would touch the 7% growth rate in the second half of this year.

“Traders may position for further weakness into the year-end, suspecting financial curbs will continue to have a negative impact on growth in China,” said Stephen Innes, head of trading for Asia at Oanda.

But with the key Chinese Communist Party Congress in session this week, there was pressure to maintain market stability, say analysts, and they expect some last minute buying through state-owned funds to prop up shares.

The Wall Street Journal

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Stephen Innes

Stephen Innes

Head of Trading APAC at OANDA
Stephen has over 25 years of experience in the financial markets and currently based in Singapore as the Head of Trading Asia Pacific with OANDA. Stephen's market views focus on the movement of G-10 and ASEAN Currencies. His views appear in Bloomberg, CNBC.Reuters, New York Times WSJ and the Economist. His media appearances include Bloomberg TV & Radio, BBC International, Sky TV, Channel News Asia, ASTRO AWANI and BFM Malaysia. Stephen has an extensive trading experience in Spot and Forward FX, Currency and Interest Rate Futures, Money Market Derivatives and Precious Metals. Before joining OANDA, he worked with organisations like Nat West, Chemical Bank, Garvin Guy Butler, and Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes
Stephen Innes

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