Chinese financial stocks catch a bid after PBOC cuts lending rates again (NYSE:FINV)

CHUNYIP WONG/E+ via Getty Images

A number of Chinese financial stocks were in the green on Monday afternoon after China’s central bank cut key rates just a week after surprising with rate cuts.

US Custodian FinVolution Group revenue (NYSE: FINV) +2.5% and KE Holdings (NYSE: BEKE) +3.5% increased the most among its peers. Future Holdings (NASDAQ: FUTU) +1.2% shares also rose.

In an effort to boost the world’s second-largest economy, reeling from prolonged Covid-related lockdowns as well as an ongoing housing market slump, the People’s Bank of China previously cut its benchmark one-year lending rate to 3, 65% from 3.7%, and its five-year rate at 4.3% from 4.45%.

“China is cutting rates to try to save its housing market. But it won’t work,” economics commentator Tarric Brooker wrote on Twitter. Publish. “As hard as they try, they can’t stabilize a bubble at those heights, they can either pump it even higher by blowing more resources on it, or it will burst.”

Speaking of the housing slump in the country, the PBOC previously reportedly planned to lend $29 billion in special loans to cash-strapped property developers for homes that have already been sold but have not yet been sold. not yet been completed.

Meanwhile, the broader Chinese stock market was mixed, the Shanghai Composite (SHCOMP) +0.6% and the Hang Seng Index (HSI) -0.5%as investors assess the PBOC’s dovish monetary actions in a world that now largely pursues hawkish policy amid stubbornly high inflation.

Last week (August 15), China surprised with a rate cut as economic data remained weak.