Chinese stocks trading in New York rose, posting their second weekly gain, on speculation the government will take additional steps to stimulate the economy. Weibo Corp. climbed 19 percent in its trading debut.
The Bloomberg index of the most-traded Chinese stocks in the U.S. added 0.7 percent to 100.52 yesterday. Baidu Inc., owner of the country’s most popular search engine, increased 4 percent this week while online fashion retailer Vipshop Holdings Ltd. jumped 10 percent. Weibo, the Chinese microblogging service owned by Sina Corp., surged on the Nasdaq Stock Market after pricing its initial public offering at the low end of the marketed range.
Data this week showed that China’s expansion moderated to the weakest pace in six quarters and property construction plunged, bolstering bets the government will expand stimulus measures. The State Council said April 16 that it would lower reserve requirements at some rural banks to provide more funds to agriculture-related industries, building on plans announced earlier this month for railway and housing spending and tax breaks to support growth.
“The Chinese look like they’re starting to stimulate their economy,” Dave Lutz, the head of ETF trading and strategy at Stifel Nicolaus & Co., said in a telephone interview from Baltimore. “That’s lending some optimism.”
The iShares China Large-Cap ETF, the largest Chinese exchange-traded fund in the U.S., rose 0.3 percent to $35.82 yesterday, trimming its weekly drop to 0.9 percent. The Standard & Poor’s 500 Index added 0.1 percent.
Gross domestic product rose 7.4 percent in the January-to-March period from a year earlier, the statistics bureau said this week, compared with a 7.3 percent median estimate in a Bloomberg News survey of analysts. Industrial production and fixed-asset investment trailed projections.
The weakest first-quarter property-investment growth since 2009 signals credit is tight and demand is faltering, adding to economic and default dangers as Premier Li Keqiang grapples with risks from shadow banking and local-government debt. A deeper slowdown would put pressure on leaders to expand stimulus or limit the pace of changes intended to give market forces a bigger role in the economy.
Chinese stocks listed in the U.S. dropped earlier as disappointing sales by Google Inc. and International Business Machine Corp. spurred a slide in technology companies.
Baidu, based in Beijing, dropped 0.9 percent to $155.80, snapping a three-day rally. The shares posted a second weekly gain, the longest advance since Feb. 21.
Vipshop, which sells discounted brand-name fashion goods, advanced 4.4 percent to $148.73, climbing for a fourth day.
Weibo increased to $20.24, after rallying as much as 44 percent. The company, which also counts Alibaba Group Holding Ltd. among its backers, raised $285.6 million in the IPO April 16, after offering the shares for $17 to $19 apiece. Sina jumped 6.7 percent to $56.55.
The Hang Seng China Enterprises Index of mainland stocks traded in Hong Kong added 0.4 percent to 10,080.23. The Shanghai Composite Index fell 0.3 percent to 2,098.89.