China’s Stock-Index Futures Rise on Money Rates Drop, GDP Target

China’s stock-index futures rose after money-market rates fell for a third day and the government estimated economic growth beat its estimates this year.

Futures on the CSI 300 Index (SHSZ300) expiring in January gained 0.1 percent to 2,317 as of 9:19 a.m. The seven-day repurchase rate, a gauge of funding availability in the banking system, slid 26 basis points to 5.32 percent. The yuan was unchanged at 6.0714 per dollar, near the highest level in 20 years.

The Shanghai Composite Index (SHCOMP) climbed 0.6 percent to 2,106.35 yesterday, with trading volumes 40 percent down from the 30-day average. The CSI 300 Index rose 0.7 percent to 2,305.11. U.S. and Hong Kong markets were closed yesterday for the Christmas holidays, with the latter shut again today.

Trainmakers CSR Corp. (601299) and China CNR Corp. may advance after the China Securities Journal said China may export trains to Europe. Guangshen Railway Co. (601333), the operator of trains in China’s richest province, may be active. Rail passenger trips during the Chinese lunar new year holidays may rise about 8 percent from a year earlier to 258 million, Xinhua reported, citing China Railway Corp.’s forecast.

China’s economic growth this year is likely to come in at 7.6 percent, above the government’s 7.5 percent target, the official Xinhua News Agency reported, citing from report by the State Council, or the cabinet. The government gave the estimate in a mid-term evaluation report on the implementation of its 12th five-year plan, Xinhua said.

The statistics bureau is due to release industrial companies’ profits for November tomorrow. Net income for the companies rose 15.1 percent in October, down from 18.4 percent growth a month earlier.

Repo Operations

The central bank won’t conduct reverse-purchase agreements today, according to traders. China’s stocks have gained since the central bank injected funds into the inter-bank market on Dec. 24 , easing a money crunch that drove capital costs to the highest level since June.

The Shanghai Composite has fallen 7.2 percent this year amid concern liquidity will tighten before the resumption of new share offerings next month. It trades at 8.1 times projected profit for the next 12 months, the cheapest since July 31, according to data compiled by Bloomberg.

To contact Bloomberg News staff for this story: Zhang Shidong in Shanghai at szhang5@bloomberg.net

To contact the editor responsible for this story: Michael Patterson at mpatterson10@bloomberg.net

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