Electric

A record 13,102 bolts of lightning struck ground in Hong Kong in the hour after midnight today as a storm raged from 21.00 yesterday through 04.00. If China raises interest rates on Monday morning, as speculated, this would be similarly shocking. Such conjecture arose because the Government has brought forward the announcement of its inflation figures to tomorrow (Saturday) instead of Monday. Industrial output is also promulgated tomorrow.

Today, China posted its third straight monthly trade surplus in excess of $20 billion (i.e. $20.03 billion) and although this is significantly up on the same month last year ($15.7 billion), it is lower than July’s tally of $28.7 billion; imports actually grew a tad more than exports in percentage terms. Similarly, the total for the year through August narrowed 14.6% to $103.9 billion. Not that this will provide succor to the US Yuan hawks, even as the Chinese currency posted its biggest weekly gain (+0.47%) since the end of June.

The property sector remained front and centre, too, as prices in 70 major cities climbed by an annual 9.3% in August. But this was the slowest in eight months and showed no change over July. Transactions and investment (+34% to $66 billion) continued to perform robustly, though, and opinion is divided on whether prices will fall or not (albeit, Jing Ulrich and I think they will). If they don’t, however, the Government is expected to introduce more controls. In any event the sub-index of property stocks in Shanghai slid a further 1.7% today to where it is off 28% year to date.

Remember, too as Willie Tyler said, “the reason lightning doesn’t strike twice in the same place is that the same place isn’t there the second time”.

Shanghai Composite:
Today: +0.26% at 2,663.21 at close
This week: +0.3%
YTD: -18.7%

Hang Seng:
Today: +0.43% at 21,257.39 at close
This week: +1.4%
YTD: -2.8%

Oil futures: $75.86
Gold futures: $1251.20
Euro/$ spot: 1.2726

Headlines

• China posts $20 billion trade surplus in August; Yuan has biggest weekly gain since late June
• China is set to announce inflation data earlier – which make point to an interest rate rise
• China property price gains slowed to 9.3% in August; slowest in eight months
• Investors are over-reacting to China’s credit growth as lending winds down, says UBS
• Banking regulator orders enhancements of risk management by trusts
• Top prices paid for building land in Beijing
• August passenger car sales growth accelerates to almost 19%
• China clean-energy aid triggers trade complaint from US union
• China trade unions plans to increase role at foreign companies
• Hong Kong public housing apartment sells for record price