Mortgage Rates Slashed As Beijing Joins Cities Cutting Purchase Restrictions, Week In Review

Week in Review

• Asian equities had a decent performance week as Mainland China markets were a bright spot with the STAR Market’s “688 Rally” mid-week on stock market reforms that included lowering transaction costs.
• E-Commerce giant Pinduoduo beat analyst estimates in its Q2 earnings, reported Tuesday, another sign that the consumer is spending more than expected.
• China’s central bank guidance is now leading to lower mortgage rates, following up on a cut to the 5-year medium-term lending facility (MLF) earlier in August.
• US Commerce Secretary Gina Raimondo completed her trip to China this week, which included visits to Beijing and Shanghai and her counterparts in China’s government as well as US businesses.

Friday’s Key News

Asian equities ended a positive week higher except for Hong Kong, which was closed due to Super Typhoon Saolo. Shanghai and Shenzhen posted small gains on light volume as the STAR Board’s “688 Rally” saw profit- taking.

Once again, there were positive catalysts today as the Caixin Manufacturing PMI beat expectations of 49 with a release of 51, indicating month-over-month expansion. Although most categories improved, including output and new orders, new export orders remain weak, a symptom of the global economic slowdown. Can we trust the data? The Caixin survey is conducted by IHS Markit
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