Local Broker Insight:
BOCOM International – Third Plenum:
“383” reform draft from a government research body takes a long term outlook so that cyclical fluctuations no longer carry great weight. It proposes that the compensation for land acquisition be made at fair market rates, which will hurt the capability of governments to repay debt. It is thus imperative to make changes in the fiscal system, and to seek other tax sources, such as property tax. http://www.bocomgroup.com/en/securities-futures/securities-brokerage.html
Galaxy – Liquidity:
The PBOC restarted reverse repurchase operations last week, easing the pattern of tight liquidity. The small scale of reverse repurchase operations and a bid rate moving higher with market momentum is a signal of the PBOC’s neutral-to-tight stance. The continued “locking long-term but relaxing short-term liquidity” operations highlight the PBOC’s efforts on limiting mismatched maturities for financial institutions. http://www.chinastock.com.hk/en/ACG/ContactUs/index.aspx
Galaxy – Agriculture:
Premier Li Keqiang mentioned agricultural modernization and agricultural machinery subsidies on an inspection tour of modernized agriculture production in Heilongjiang. He also pointed out that development of modern agriculture is still dependent upon reform. With the Third Plenum at hand, Li’s inspection tour of Heilongjiang’s modern agricultural comprehensive reform pilot will likely draw attention to the agriculture sector. http://www.chinastock.com.hk/en/ACG/ContactUs/index.aspx
SYWG
Premier Li Keqiang gave an economic trend report at the All China Federation of Trade Unions National Conference. His report highlighted a greater need for resolving issues that are highly relevant to employees. Premier Li also highlighted that an economic growth rate of 7.2% is required to generate 10 million new jobs and maintain an unemployment rate of roughly 4% for registered citizens in urban and rural areas, according to estimates from the Ministry of Human Resource and Social Security. http://www.sywg.com.hk/catalog/securities/english/ser_06.html