China's Stock Investors Are Still Hooked on Economic Stimulus
- Stocks rise on speculation more measures will lift consumption
- Borrowing costs spike as demand for cash squeezes liquidity
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China’s equity investors aren’t quite ready to see Beijing scale back its efforts to support the economy.
Stocks started the week lower after improving data prompted traders to pare back their bets for additional stimulus. The Shanghai Composite Index rallied the next day after the central bank injected cash into the financial system, alleviating concerns over a liquidity crunch. Then came speculation officials had prepared a sweeping package to boost consumption, triggering a rally in carmakers and firms that sell household goods.