{"id":40300,"date":"2018-11-09T07:35:34","date_gmt":"2018-11-09T12:35:34","guid":{"rendered":"http:\/\/olduvai.ca\/?p=40300"},"modified":"2018-11-09T07:36:10","modified_gmt":"2018-11-09T12:36:10","slug":"how-are-chinese-stocks-responding-to-tariffs-with-the-us-and-a-slowdown-in-asian-growth","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=40300","title":{"rendered":"How Are Chinese Stocks Responding to Tariffs With the US and a Slowdown in Asian Growth?"},"content":{"rendered":"<header class=\"wrapper entry-header page-header\">\n<div class=\"title-with-sep single-title\">\n<h3 class=\"entry-title\"><a href=\"https:\/\/www.cobdencentre.org\/2018\/11\/how-are-chinese-stocks-responding-to-tariffs-with-the-us-and-a-slowdown-in-asian-growth\/\">HOW ARE CHINESE STOCKS RESPONDING TO TARIFFS WITH THE US AND A SLOWDOWN IN ASIAN GROWTH?<\/a><\/h3>\n<\/div>\n<\/header>\n<div class=\"wrapper\">\n<div class=\"grids\">\n<div class=\"grid-8 column-1\">\n<div class=\"single-box clearfix entry-content\">\n<ul>\n<li>Despite US tariffs, China\u2019s September trade balance with the US reached a record high<\/li>\n<li>A number of China\u2019s Asian neighbours have seen a deceleration in growth<\/li>\n<li>The Shanghai Composite has fallen more than 50% since 2015, the PE ratio is 7.2<\/li>\n<li>Government bond yields have eased and the currency is lower against a rising US$<\/li>\n<\/ul>\n<p>During 2018 Chinese financial markets have been on the move. 10yr bond yields rose from all-time lows throughout 2017 but have since declined: \u2013<\/p>\n<p><img decoding=\"async\" class=\"alignnone size-full wp-image-1968\" src=\"http:\/\/www.cobdencentre.org\/wp-content\/uploads\/2018\/11\/china-bonds-2006-2018.png\" sizes=\"(max-width: 660px) 100vw, 660px\" srcset=\"https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-bonds-2006-2018.png?w=660 660w, https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-bonds-2006-2018.png?w=150 150w, https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-bonds-2006-2018.png?w=300 300w, https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-bonds-2006-2018.png 730w\" alt=\"China bonds 2006-2018\" data-attachment-id=\"1968\" data-permalink=\"https:\/\/inthelongrun.co.uk\/2018\/11\/09\/how-are-chinese-stocks-responding-to-tariffs-with-the-us-and-a-slowdown-in-asian-growth\/china-bonds-2006-2018\/#main\" data-orig-file=\"https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-bonds-2006-2018.png?w=660\" data-orig-size=\"730,340\" data-comments-opened=\"1\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;0&quot;}\" data-image-title=\"China bonds 2006-2018\" data-image-description=\"\" data-medium-file=\"https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-bonds-2006-2018.png?w=660?w=300\" data-large-file=\"https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-bonds-2006-2018.png?w=660?w=660\" \/><\/p>\n<p><em>Source: Trading Economics, PRC Ministry of Finance<\/em><\/p>\n<p>Despite this easing of monetary conditions the negative impact US tariffs, continues to weigh on the Chinese stock market: \u2013<\/p>\n<p><img decoding=\"async\" class=\"alignnone size-full wp-image-1970\" src=\"http:\/\/www.cobdencentre.org\/wp-content\/uploads\/2018\/11\/china-shanghai-index-1990-2018.png\" sizes=\"(max-width: 660px) 100vw, 660px\" srcset=\"https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-shanghai-index-1990-2018.png?w=660 660w, https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-shanghai-index-1990-2018.png?w=150 150w, https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-shanghai-index-1990-2018.png?w=300 300w, https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-shanghai-index-1990-2018.png 730w\" alt=\"China shanghai index 1990-2018\" data-attachment-id=\"1970\" data-permalink=\"https:\/\/inthelongrun.co.uk\/2018\/11\/09\/how-are-chinese-stocks-responding-to-tariffs-with-the-us-and-a-slowdown-in-asian-growth\/china-shanghai-index-1990-2018\/#main\" data-orig-file=\"https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-shanghai-index-1990-2018.png?w=660\" data-orig-size=\"730,340\" data-comments-opened=\"1\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;0&quot;}\" data-image-title=\"China shanghai index 1990-2018\" data-image-description=\"\" data-medium-file=\"https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-shanghai-index-1990-2018.png?w=660?w=300\" data-large-file=\"https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-shanghai-index-1990-2018.png?w=660?w=660\" \/><\/p>\n<p><em>Source: Trading Economics, OTC, CFD<\/em><\/p>\n<p>Despite being a leader in frontier technologies such as e-commerce (China has 733mln internet users compared with 391mln in India, 413mln in the EU and a mere 246mln in the US) the recent decline in tech giants Alibaba (BABA) and Tencent (TCEHY) have added to financial market woes. However, as the chart above shows, Chinese stocks have been in a bear-market since 2015. Some of its Asian neighbours have followed a similar trajectory as their economies have slowed in response to a US$ strength and US trade policy.<\/p>\n<p>The notionally pegged Chinese currency has also weakened against the US$, testing it lowest levels in almost a decade: \u2013<\/p>\n<p><img decoding=\"async\" class=\"alignnone size-full wp-image-1969\" src=\"http:\/\/www.cobdencentre.org\/wp-content\/uploads\/2018\/11\/china-currency-2008-2018.png\" sizes=\"(max-width: 660px) 100vw, 660px\" srcset=\"https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-currency-2008-2018.png?w=660 660w, https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-currency-2008-2018.png?w=150 150w, https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-currency-2008-2018.png?w=300 300w, https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-currency-2008-2018.png 730w\" alt=\"China currency 2008-2018\" data-attachment-id=\"1969\" data-permalink=\"https:\/\/inthelongrun.co.uk\/2018\/11\/09\/how-are-chinese-stocks-responding-to-tariffs-with-the-us-and-a-slowdown-in-asian-growth\/china-currency-2008-2018\/#main\" data-orig-file=\"https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-currency-2008-2018.png?w=660\" data-orig-size=\"730,340\" data-comments-opened=\"1\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;0&quot;}\" data-image-title=\"China currency 2008-2018\" data-image-description=\"\" data-medium-file=\"https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-currency-2008-2018.png?w=660?w=300\" data-large-file=\"https:\/\/inthelongrunwerealldead.files.wordpress.com\/2018\/11\/china-currency-2008-2018.png?w=660?w=660\" \/><\/p>\n<p><em>Source: Trading Economics<\/em><\/p>\n<p>Meanwhile, President Xi has now announced plans to rebalance China\u2019s economy towards consumption, turning it into an importing superpower. Surely something has to give.<\/p>\n<p>The\u00a0<strong><a href=\"https:\/\/www.imf.org\/en\/News\/Articles\/2018\/07\/25\/na072618-chinas-economic-outlook-in-six-charts\">IMF<\/a><\/strong>\u00a0expects Chinese GDP to grow at 6.6% in 2018. They continue to point to signs of economic progress: \u2013<\/p>\n<p>\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>HOW ARE CHINESE STOCKS RESPONDING TO TARIFFS WITH THE US AND A SLOWDOWN IN ASIAN GROWTH? Despite US tariffs, China\u2019s September trade balance with the US reached a record high A number of China\u2019s Asian neighbours have seen a deceleration in growth The Shanghai Composite has fallen more than 50% since 2015, the PE ratio [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[6530,7380,14105,2491,6537,9937,805,3222,827],"class_list":["post-40300","post","type-post","status-publish","format-standard","hentry","category-economics","tag-chinese-stocks","tag-cobden-centre","tag-colin-lloyd","tag-government-bonds","tag-shanghai-composite","tag-tariffs","tag-trade","tag-trade-war","tag-united-states"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/40300","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=40300"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/40300\/revisions"}],"predecessor-version":[{"id":40301,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/40300\/revisions\/40301"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=40300"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=40300"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=40300"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}