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How Are Markets Responding To China's Sudden Rate Cuts?

Market Depth

NOTE

The Market Response to the China Reopening

The market response to rate cutting measures and stimulus talk has been lethargic./nSingle stocks in the property sector like Country Garden and Long For saw upside of 3% each on the day./nIn a recent episode of Market Depth about the property sector index price action, the index and development indices were up 4% and almost 10% respectively./nThe lack of response in the market is due to short covering rather than the opening of new long positions./nExpected rate cuts by the PBOC are already priced into the markets and will not be a surprise./nPolicy easing measures can signal a shift in policy regime, but only time will tell if it comes to fruition.

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