China’s stimulus triggered a 16% rally in the CSI 300 Index, its biggest since 2008, boosting stocks like Alibaba.
Sectors & Industries
September 30, 2024
On Friday, China’s central bank lowered interest rates and injected liquidity into the banking system as Beijing launched a major stimulus effort to push economic growth closer to its 5% target for the year. In response, Chinese stocks experienced their biggest weekly rally since 2008, with the CSI 300 Index surging 16%, including a 4.5% gain on Friday.
The stimulus package included a 2 trillion yuan ($284 billion) special sovereign bond issuance, a 50-basis point reserve requirement ratio cut, and additional housing market support. Intense trading overwhelmed the Shanghai Stock Exchange, causing delays. This comes after the CSI 300 index neared a 5 year low. However, the index is now in the green for the year. Stocks like Alibaba rocketed over 20% this week as well as material stocks like MP rising nearly 30%.
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