China stocks tepid after poor industrial profits data

China stocks tepid after poor industrial profits data

Despite Trump's indication of a trade deal, Chinese stocks are not bullish.

Representative Image. (Reuters Photo)

China stocks struggled to make headway on Wednesday even as U.S. President Donald Trump signalled a trade deal with Beijing was close, as poor industrial profits underlined the pressure on the country's economy from the protracted tariff war.

At the midday break, the Shanghai Composite index edged up about 0.2% to 2,911.76 points as positive signals on U.S.-China trade talks gave some comfort to investors. The index was in negative territory for much of the morning session.

The blue-chip CSI300 index was down 0.1%. CSI300's financial sector sub-index fell by 0.1%, the consumer staples sector rose 0.3% and the healthcare sub-index was down 0.2%.

The smaller Shenzhen index rose 0.1% and the start-up board ChiNext Composite index was higher by 0.3%.

Profits at China's industrial firms shrank at their fastest pace in eight months in October, official data released on Wednesday showed.

Industrial profits fell 9.9% in October year-on-year to 427.56 billion yuan ($60.74 billion), marking the biggest drop since January-February period and compared with a 5.3% decline in September.

Trump said Washington was in the "final throes" of work on a deal that would defuse a 16-month trade war with Beijing, but also underscored Washington's support for protesters in Hong Kong, a potential huge sore point with China.

China said on Tuesday it has summoned the U.S. ambassador to protest the passage in the U.S. Congress of the Hong Kong Human Rights and Democracy Act.

MSCI has completed the final phase of the 20% inclusion of Chinese A-shares in MSCI indexes, the index publisher said on Tuesday. A-shares now weigh 4% in the benchmark MSCI Emerging Markets Indexes, MSCI said in a press release.

In Hong Kong, Chinese H-shares was pretty much flat while the Hang Seng Index gained less than 0.1% to 26,926.30. One of Hong Kong's main highway links, the Cross-Harbour Tunnel, reopened early on Wednesday as a lockdown of the nearby Polytechnic University appeared to be drawing to a close with teams still combing the campus for remaining protesters.

The largest percentage gainers in the main Shanghai Composite index were Xinjiang Talimu Agriculture Development Co Ltd , Zhejiang Tiancheng Controls Co Ltd and Sichuan Golden Summit Group Joint Stock Co Ltd, all up by 10.1%.

Around the region, MSCI's Asia ex-Japan stock index was firmer by 0.3% while Japan's Nikkei index was up 0.5%. As of 04:00 GMT, China's A-shares were trading at a premium of 27.57% over the Hong Kong-listed H-shares. The Shanghai stock index is below its 50-day moving average and below its 200-day moving average.

Get a round-up of the day's top stories in your inbox

Check out all newsletters

Get a round-up of the day's top stories in your inbox