Some analysis indicates that the Political Bureau meeting first mentioned stabilizing the stock and real estate markets, and the US stock market quickly rallied on china assets. The 3x Long FTSE china etf surged over 26%, the 2x Long china internet plus-related stocks rose over 22%, the 2x Long FTSE china 50 ETF increased over 17%, and the 2x Long 300etf gained nearly 15%.
On Monday, December 9th, in the early trading hours of U.S. stocks, as the three major indexes collectively fell and the Russell 2000 small cap index retreated from its gains, the China Concept Index surged, with the Nasdaq Golden Dragon China Index soaring as much as 10.6%, marking the largest intraday gain in three months.
Among them, fangdd network surged over 165% and triggered trading halts three times in the early hours, ke holdings and land control rose nearly 20%, mmtec inc climbed nearly 32%, and garden stage increased over 28%.
China concept stocks experienced a collective surge. Baozun rose nearly 27%, Bilibili increased over 21%, oneconnect financial technology, Dada, and 9f inc jumped nearly 16%, NIO rose nearly 14%, Xiaopeng autos climbed nearly 15%, Li Auto, pdd holdings, and netease increased nearly 11%, zeekr rose nearly 10%, jd.com surged over 12%, baidu rose over 9%, alibaba increased over 8%, and Tencent ADR rose over 5%, while universe pharmaceuticals, which soared in previous days, fell over 58%.
ETFs also jumped by double digits, with the FTSE China 3x Long ETF (YINN) soaring over 26%, the China Technology Index ETF (CQQQ) rising over 9%, the China Internet Index ETF (KWEB) increasing nearly 11%, the 2x Long China Internet Stocks ETF (CWEB) climbing over 22%, the 2x Long FTSE China 50 ETF (XPP) rising over 17%, and the 2x Long 300 ETF (CHAU) increasing over 15%.
At the same time, the FTSE China A50 Index futures night session saw gains extend to over 2%, closing up 4.66% on the previous trading day. The offshore RMB briefly surged past 7.26 against the U.S. dollar, rising over 250 points intra-day, an increase of 0.35%, heading towards its highest level this month.
According to Xinhua News Agency, the Political Bureau of the Communist Party of China held a meeting on the 9th, analyzing and studying the economic work for 2025, discussing the construction of party conduct and anti-corruption efforts, proposing to implement a more proactive fiscal policy and a moderately loose monetary policy, and strengthening extraordinary counter-cyclical adjustments.
Analysts pointed out that the Political Bureau meeting first proposed stabilizing the stock and real estate markets, and reviewing the practices of China's monetary policy over the past 30 years, it was noted that the People's Bank of China only implemented a 'moderately loose' monetary policy during the 2009-2010 period, which led to a rapid rise of Chinese assets in the U.S. stock market.
According to industry insiders cited by China Securities Journal, the "more aggressive" fiscal policy framework may offer an expected increase in central deficit space; under the "moderately easing" framework, monetary policy may focus more on internal balance, with expectations for reductions in reserve requirements and interest rates.
In addition to the surge in Chinese concept stocks and the renminbi, the domestic black series futures night market also generally closed higher with significant increases. Coking coal rose by 5.6%, glass increased by over 5%, thermal coal rose by over 4.5%, synthetic rubbers increased by 4.4%, rebar and soda ash rose by over 3%, and iron ore rose by 2.74%. In the London market for industrial basic metals, zinc rose by over 2%, copper increased by over 1%, and tin, lead, and aluminum also saw increases.
China Securities Journal states that, regarding the impact of policy releases on major asset classes, Gu Fengda, chief analyst for non-ferrous metals at Guosen Futures, predicts that the equity market will continue its mid-term upward trend.
According to interpretations from multiple experts cited by Daily Economic News:
Wang Qing, chief macro analyst at Dongfang Jincheng, determines that by 2025, measures such as lowering mortgage rates for residents, increasing credit allocations for real estate enterprises, accelerating the implementation of monetized resettlement for urban village renovations, and using special bond funds to acquire indemnificatory apartments represent supportive policies for the real estate sector from both supply and demand sides, with further room for enhancement. The key is to reduce the actual mortgage rate for residents, which remains high even after considering price factors.
The chief economist of citic sec, Mingming, believes that this political bureau meeting first proposed to "stabilize the real estate and stock markets," making stability in the stock market one of the key points of economic work for next year. For the stock market, the political bureau meeting has basically set a positive tone for next year's policies, and market risk appetite is expected to remain high, with a clear trend of economic recovery. It is anticipated that driven by both policy expectations and economic trends, the stock market is likely to continue its oscillating upward pattern.
The research reports from Shenyin Wanguo Securities emphasize that the meeting notably stressed "stabilizing the real estate and stock markets," highlighting that current policies focus more on the impact of asset performance on the real economy. Positive signals from the policies continue to be released, with more specific deployments to be closely monitored at the upcoming Central Economic Work Conference and others.
