Market Talk – Friday, March 5


China is aiming for an economic growth rate above 6% in 2021. After scrapping its target last year, Chinese Premier Li Keqiang announced the target on Friday at the opening of this year’s National People’s Congress. The target marks a return to strong growth after the Covid-19 pandemic impacted the world’s second-largest economy. By some measures, the target appears modest, falling well below the International Monetary Fund’s estimated of 8.1% growth for China’s economy this year.

Morgan Stanley reported Indian state-owned banks are expected to see additions to bad loans moderate, but structural issues at the banks could cap returns on their stocks. Some of the country’s state-owned banks have long struggled with a pile of bad loans, prompting the government to pump in more funds to shore up their balance sheets. The brokerage preferred India’s largest lender, State Bank of India, as well as large private banks, expecting them to play a major role in the corporate recovery cycle.

The BRICS New Development Bank (NDB) announced Tuesday that it approved 7 billion yuan ($1.08 billion) of emergency assistance program loans to support China’s economic recovery from COVID-19. The loan is the second emergency loan approved by the NDB to help China fight the epidemic, following the same loan approved and disbursed last year. The program is to support the restoration of production activities and stable employment in the country and promote sustainable economic development, according to the bank.

The major Asian stock markets had a negative day today:

  • NIKKEI 225 decreased 65.79 points or -0.23% to 28,864.32
  • Shanghai decreased 1.50 points or -0.04% to 3,501.99
  • Hang Seng decreased 138.50 points or -0.47% to 29,098.29
  • ASX 200 decreased 49.90 points or -0.74% to 6,710.80
  • Kospi decreased 17.23 points or -0.57% to 3,026.26
  • SENSEX decreased 440.76 points or -0.87% to 50,405.32
  • Nifty50 decreased 142.65 points or -0.95% to 14,938.10
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