China Stock Rally Defies Construction Slowdown: Chart of the Day
This article is for subscribers only.
Chinese stocks are decoupling from steel prices by the most in three years as equity investors bet Asia’s largest economy will withstand a property slowdown.
The CHART OF THE DAY tracks the Shanghai Composite Index against a gauge of the most liquid steel contracts traded in the city. The stock measure has rallied 12 percent since its March low. Steel reinforcement-bar futures have fallen 10 percent in the period to their lowest level since trading started in 2009. While fixed-asset investment growth slowed in the first seven months to the weakest since 2001 and sales of buildings plunged in July by the most in four years, the nation’s exports surged 14.5 percent in the biggest increase since April 2013.