Core Insights - China's consumer inflation showed a mild increase in December, indicating a slight uptick in consumer prices amid ongoing economic challenges [1] - Factory-gate prices, however, continued to experience contraction, reflecting persistent deflationary pressures within the manufacturing sector [1] - The overall economic environment remains characterized by weak domestic demand, which has been a significant factor contributing to deflationary trends throughout the year [1] Consumer Inflation - Consumer inflation in China picked up mildly in December, suggesting a potential shift in consumer spending patterns [1] - This increase in consumer prices may indicate a gradual recovery in consumer confidence, although it remains fragile [1] Factory-Gate Prices - Factory-gate prices remained in contraction, highlighting ongoing challenges faced by manufacturers in passing on costs to consumers [1] - The persistent contraction in factory-gate prices suggests that manufacturers are under pressure, which could impact profitability and investment in the sector [1] Domestic Demand - Weak domestic demand continues to be a significant issue for the Chinese economy, contributing to deflationary pressures [1] - The lack of robust consumer spending may hinder economic recovery and growth prospects in the near term [1]

NEW YORK (AP) — Wall Street drifted through a quiet day of trading on Monday, ahead of economic reports this week that could drive where interest rates go. The S&P 500 slipped 0.2%, though the majority of stocks within the index rose. The Dow Jones Industrial Average dipped 41 points, or 0.1%, and the Nasdaq composite fell 0.6%. Helping to keep indexes in check were stocks in the artificial-intelligence industry, which were mixed following last week’s scary swings. Nvidia, the chip company that’s become ...

Core Viewpoint - Hong Kong's share-sale market has experienced a significant turnaround in 2023, becoming the leading fundraising hub in Asia, with share sales nearly quadrupling to over $73 billion, driven by strong demand from Chinese companies [1][2][3]. Group 1: Market Performance - Share sales in Hong Kong reached more than $73 billion through various methods, making it the top fundraising location in Asia for the first time since 2013, ranking just behind the US globally [2]. - The Hong Kong IPO pipeline is robust, with approximately 300 companies waiting to list, indicating a healthy market outlook [5]. - The Hang Seng Index has gained 29.5% this year, marking its best performance since 2017, although signs of weakness have emerged in the fourth quarter [11]. Group 2: Key Drivers - Chinese companies have been pivotal in driving the share-sale frenzy, with major listings such as Contemporary Amperex Technology Co. raising $5.3 billion, and both BYD Co. and Xiaomi Corp. raising over $5 billion each [3][8]. - The market has benefited from China's ambitions in artificial intelligence, biotechnology advancements, and efforts to boost domestic demand [8]. - Sectors aligned with China's strategic goals, such as technology and advanced manufacturing, are expected to remain active in pursuing IPOs [8]. Group 3: Future Outlook - Heavyweight candidates for future listings include companies like Syngenta Group and A.S. Watson Group, alongside potential listings from China's AI sector [9]. - The market's ability to absorb the upcoming supply of IPOs will depend on valuation and broader stock market performance [10]. - Despite the current optimism, there are concerns regarding the sustainability of high valuations, as many newly listed companies in India are trading below their debut prices [15].

Credit Growth and Economic Indicators - Financial institutions extended ¥392 billion ($55.6 billion) of new yuan loans in November, falling short of the median forecast of ¥450 billion, indicating weak credit growth [1][6] - Household loans contracted for the second consecutive month, marking the first such occurrence since 2005, reflecting a trend of net debt repayment by residents due to a bleak job market and deteriorating housing market [1][6] - New medium- and long-term corporate loans weakened compared to the previous year, suggesting a lack of demand for business expansion [2][6] - Bill financing, a tool used by banks to inflate lending, more than doubled, indicating dire business demand [2][6] Future Outlook - Credit growth is expected to remain weak in the coming months, with subdued loan demand anticipated due to elevated real lending rates amid deflation [3][6] - The growth rate of the credit stock accelerated earlier in the year but has slowed recently, attributed to government bond sales and weakening economic momentum [6] EU Import Duties - The European Union finance ministers agreed to impose a three-euro duty on all small parcels imported into the bloc starting July 1, 2026, to address the influx of cheap imports, primarily from China [7][10] - This decision follows the removal of a duty exemption for packages valued under €150 ($174), which was commonly used for direct consumer imports from Chinese platforms [8][10] - In the previous year, 4.6 billion small packages entered the EU, with 91% originating from China, and the EU expects this number to rise [10]

Key economic data for November are set to show China’s domestic demand remained subdued — or even weakened further — offsetting the country’s solid performance in exports https://t.co/GYQofOZNto ...

Economic Policy Meeting - Investors are anticipating a key economic policy meeting with President Xi Jinping and other leaders, seeking signals to sustain the stock rally that has occurred this year [1] - The annual Central Economic Work Conference is crucial as it sets the macroeconomic agenda for the following year, with the market looking for new catalysts to extend its solid performance [1] Fiscal and Monetary Policy Expectations - Investors expect Beijing to maintain a proactive fiscal stance and accommodative monetary policy in 2026, focusing on stronger domestic demand, technological innovation, and reducing excess capacity in the green economy [2] - Analysts highlight that fiscal policy will be a major focus, with potential front-loading of fiscal spending or deficits likely benefiting small-cap and high-beta consumer-discretionary companies, such as retailers [3] Market Performance and Economic Fundamentals - The CSI 300 Index has increased by 17% this year, outperforming the S&P 500's 16% gain, while the technology board of the Shanghai Stock Exchange has surged by 36% [4] - Recent data indicates a broadening economic slowdown and a continued decline in property prices, which has affected the market's ability to build on recent gains [4] Policy Priorities - An earlier Politburo meeting chaired by Xi Jinping has outlined priorities for the upcoming conference, emphasizing domestic consumption and technological self-reliance for 2026, along with continued fiscal expansion and monetary easing [5][6] - The meeting's readout did not specifically address the property sector or capital markets, indicating a potential shift in focus [6]

US-China Trade Dynamics - Chinese companies still rely on the American market, despite double-digit falls in exports to the US over the past eight months [2][3] - China's exports to the US are being rerouted through third countries like Vietnam, Thailand, Malaysia, Philippines, Indonesia, and Mexico [3] - If Chinese companies completely lost access to the American market, their profits would significantly decrease [4] China's Economic Strategy - China is diversifying its trade relationships, indicating that the US is not the only market for Chinese goods [4] - The primary focus is on the weakness of Chinese domestic demand and the country's increasing ability to meet its own needs domestically [5] - The Politburo has decided to prioritize boosting domestic demand in 2026 [6] Stimulus and Import Reliance - The expected stimulus is not very large, limiting its impact [8] - Chinese companies are increasingly capable of filling domestic demand gaps, reducing reliance on imports [8][9] - China is less reliant on imports than ever before, diminishing the flow-through effects of domestic rebalancing to foreign countries compared to the 2008 stimulus [9][10]

Myanmar’s economic growth remains constrained due to weak domestic demand, labor shortages and frequent power outages, with the nation only seeing moderate signs of recovery in the first half of the current fiscal year, the World Bank says https://t.co/DeqYxY9fOG ...

Summary of Key Points from the Conference Call Industry Overview - The focus is on the Chinese economy, particularly regarding fixed asset investment (FAI) and gross capital formation (GCF) trends in 2025 and beyond [1][2][3]. Core Insights and Arguments 1. **Growth Projections**: Despite weak FAI, GCF resilience and fall stimulus are expected to keep 2025 growth on track to reach 5% [1][6]. 2. **Investment Disconnect**: There is a notable disconnect between macro fundamentals and stock market performance, with domestic demand data weakening significantly in 3Q and October [2][11]. 3. **FAI Methodology Changes**: The National Bureau of Statistics (NBS) has shifted its FAI methodology from "project progress" to "financial spending" since 2018, improving data quality but introducing potential time lags between FAI and GCF [3][8]. 4. **Factors Contributing to Weaker FAI**: - Tighter government financing has constrained new project starts. - Anti-involution measures and potential under-reporting by local governments may have suppressed reported FAI figures. - Weaker land sales in 3Q added downward pressure on FAI [4][5]. 5. **GCF Stability**: Although weak FAI in 3Q25 may signal a slowdown in GCF in 4Q25, fiscal expansion measures and a trade détente are expected to cushion the impact, potentially stabilizing GCF [5][10]. Additional Important Insights 1. **Policy Measures for 2026**: Incremental policy levers are anticipated, including front-loaded fiscal policies and housing market guardrails to support domestic demand [1][12][11]. 2. **Housing Market Risks**: The property market is under stress with record-high inventory and declining prices, raising concerns about the potential need for restructuring among developers [13][14]. 3. **Consumption Support**: There is a focus on service consumption support in 2026, with expectations for trade-in programs and other measures to stimulate demand [17][18]. 4. **Fiscal Constraints**: Public debt is at 113% of GDP, limiting the government's ability to shift focus towards consumption-driven growth [19]. Conclusion - The overall outlook suggests a slow-burn reflation scenario, with GDP expected to move out of deflation by 2026. Policy adjustments in infrastructure, housing, and consumption are likely to be reactive rather than proactive, providing a floor for growth [18][19].

Italy achieved some slight growth in the third quarter amid support from domestic demand https://t.co/sn9vxCLP77 ...