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China surpassed Japan as the world’s second-largest stock market for the first time in three years amid growing investor confidence that policy makers in Beijing will revive the economy with monetary stimulus.
China’s market capitalization climbed to $4.48 trillion yesterday after a 33 percent increase this year, according to data compiled by Bloomberg. Japan’s slipped to $4.46 trillion and has dropped 3.2 percent since the end of December. China was briefly the second-biggest market, behind the U.S., in March 2011 after an earthquake in Japan sent shares tumbling in Tokyo.
While the weakening yen played a role in Japan’s shrinking market value in dollar terms, the Shanghai Composite Index (SHCOMP) has climbed three times as much as Tokyo’s Topix this year. China cut interest rates for the first time since 2012 last week and economists predict authorities will take more steps to support an economy headed for its slowest annual expansion since 1990. The Shanghai gauge still has a price-to-earnings ratio 21 percent lower than its Japanese counterpart.
“I still have a very bullish stance” on Chinese shares, said Dickie Wong, an executive director of research at Kingston Financial Group in Hong Kong. “They’re trading at low valuations.”
The growth in China’s market value, helped by the resumption of initial public offerings in January after a more than yearlong freeze, marks a turnaround for an equity market that was among the world’s worst performers from late 2010 through the middle of last year. It comes as authorities give foreign investors unprecedented access to mainland shares through the Shanghai-Hong Kong exchange link.
Market Rally
China’s stocks rose for a sixth day yesterday, sending the Shanghai gauge to a three-year high on record turnover, after the central bank refrained from selling repurchase agreements for the first time since July in a sign of looser monetary policy.
The Shanghai index is up 24 percent this year through yesterday, set for its steepest annual advance since 2009. It trades at 12.5 times reported earnings, compared with 15.9 for Japan’s Topix index. The Shanghai measure rose 0.7 percent to 2,649.57 at the 11:30 a.m. break today.
Banks dominate China’s biggest companies. Industrial & Commercial Bank of China Ltd. is the largest mainland-listed company with a market value of $223.1 billion, according to data compiled by Bloomberg. Agricultural Bank of China Ltd. and China Merchants Bank Co. were ranked second and third. ICBC has advanced 7.5 percent in Shanghai in 2014, while Agribank gained 10 percent and China Merchants Bank climbed 5.6 percent.
China Bulls
“Keep buying China,” said Douglas Morton, head of Asia research at equity brokerage Aviate Global LLP. “It is this time of year we generally get government policy supporting the economy to hit full-year targets and when next year’s growth targets are announced. We expect more supportive policy and an imminent reserve-requirement ratio cut.”
Both Chinese President Xi Jinping’s Communist Party and Japanese Prime Minister Shinzo Abe’s ruling coalition have stepped up economic stimulus this year. The Topix has gained 6.9 percent in 2014 through yesterday, while the yen weakened 10 percent against the dollar, on Abe’s policies of unprecedented monetary easing and increased government spending.
China surpassed Japan as the world’s second-largest economy in 2010. Its gross domestic product was valued at $9.2 trillion last year, about 89 percent more than Japan’s, data compiled by Bloomberg show. China’s market capitalization data includes companies with a primary listing on mainland exchanges.
https://www.
bloomberg.com/news/2014-11-27/china-surpasses-japan-as-world-s-second-biggest-equity-market.html
China overtakes Japan in stock market cap - fastFT: Market-moving news and views, 24 hours a day - FT.com
China has just hit another milestone.
In 2010 China's economy overtook Japan's as the world's second largest economy. This week the country's stock market has finally caught up.
Thanks to a broad decline in the Japanese yen and a major rally in Chinese equities, the total value of China's stock market has finally surpassed Japan's to snatch the number two spot in the world, after the US.
The total value of China's equity market in US dollars finished Wednesday at $4.448tn, just a sliver below the entire value of Japan's market, at $4.507tn, according to data from Bloomberg.
The data is always delayed by a day, but it appears that China's equity market overtook Japan's on Thursday.
China's Shanghai Composite, the most widely used index in China, rose 0.7 per cent in mid-afternoon trading. Japan's Topix, the key index for Japan, finished lower by 1 per cent. Using these indices as broader proxies, and taking into account today's currency moves, China's total market cap has now grown to $4.480tn, while Japan's has slipped to $4.478tn (see charts below).
The Shanghai market has rallied 24 per cent this year, including a 14.5 per cent gain since late October when investors began to price in the launch of the Shanghai-Hong Kong Connect scheme, which for the first time allows international investors direct access to Shanghai stocks. China's market extended its rally this week after the People's Bank of China surprised markets with its first cut to benchmark interest rates in two years, spurring talk that will Beijing will offer further help as the economy cools.
The Japanese market has been rallying in recent months too, but weakness in the yen has robbed investors buying in dollars. The Topix is up nearly 7 per cent this year, but the yen has tumbled 11.4 per cent. As a result the Topix has fallen 4.1 per cent in US dollar terms.
Figures above and in the charts below are as of 3pm in Hong Kong - an hour after Japan's market closed. China's markets are still trading as of pixel time.
China’s market capitalization climbed to $4.48 trillion yesterday after a 33 percent increase this year, according to data compiled by Bloomberg. Japan’s slipped to $4.46 trillion and has dropped 3.2 percent since the end of December. China was briefly the second-biggest market, behind the U.S., in March 2011 after an earthquake in Japan sent shares tumbling in Tokyo.
While the weakening yen played a role in Japan’s shrinking market value in dollar terms, the Shanghai Composite Index (SHCOMP) has climbed three times as much as Tokyo’s Topix this year. China cut interest rates for the first time since 2012 last week and economists predict authorities will take more steps to support an economy headed for its slowest annual expansion since 1990. The Shanghai gauge still has a price-to-earnings ratio 21 percent lower than its Japanese counterpart.
“I still have a very bullish stance” on Chinese shares, said Dickie Wong, an executive director of research at Kingston Financial Group in Hong Kong. “They’re trading at low valuations.”
The growth in China’s market value, helped by the resumption of initial public offerings in January after a more than yearlong freeze, marks a turnaround for an equity market that was among the world’s worst performers from late 2010 through the middle of last year. It comes as authorities give foreign investors unprecedented access to mainland shares through the Shanghai-Hong Kong exchange link.
Market Rally
China’s stocks rose for a sixth day yesterday, sending the Shanghai gauge to a three-year high on record turnover, after the central bank refrained from selling repurchase agreements for the first time since July in a sign of looser monetary policy.
The Shanghai index is up 24 percent this year through yesterday, set for its steepest annual advance since 2009. It trades at 12.5 times reported earnings, compared with 15.9 for Japan’s Topix index. The Shanghai measure rose 0.7 percent to 2,649.57 at the 11:30 a.m. break today.
Banks dominate China’s biggest companies. Industrial & Commercial Bank of China Ltd. is the largest mainland-listed company with a market value of $223.1 billion, according to data compiled by Bloomberg. Agricultural Bank of China Ltd. and China Merchants Bank Co. were ranked second and third. ICBC has advanced 7.5 percent in Shanghai in 2014, while Agribank gained 10 percent and China Merchants Bank climbed 5.6 percent.
China Bulls
“Keep buying China,” said Douglas Morton, head of Asia research at equity brokerage Aviate Global LLP. “It is this time of year we generally get government policy supporting the economy to hit full-year targets and when next year’s growth targets are announced. We expect more supportive policy and an imminent reserve-requirement ratio cut.”
Both Chinese President Xi Jinping’s Communist Party and Japanese Prime Minister Shinzo Abe’s ruling coalition have stepped up economic stimulus this year. The Topix has gained 6.9 percent in 2014 through yesterday, while the yen weakened 10 percent against the dollar, on Abe’s policies of unprecedented monetary easing and increased government spending.
China surpassed Japan as the world’s second-largest economy in 2010. Its gross domestic product was valued at $9.2 trillion last year, about 89 percent more than Japan’s, data compiled by Bloomberg show. China’s market capitalization data includes companies with a primary listing on mainland exchanges.
https://www.
China overtakes Japan in stock market cap - fastFT: Market-moving news and views, 24 hours a day - FT.com
China has just hit another milestone.
In 2010 China's economy overtook Japan's as the world's second largest economy. This week the country's stock market has finally caught up.
Thanks to a broad decline in the Japanese yen and a major rally in Chinese equities, the total value of China's stock market has finally surpassed Japan's to snatch the number two spot in the world, after the US.
The total value of China's equity market in US dollars finished Wednesday at $4.448tn, just a sliver below the entire value of Japan's market, at $4.507tn, according to data from Bloomberg.
The data is always delayed by a day, but it appears that China's equity market overtook Japan's on Thursday.
China's Shanghai Composite, the most widely used index in China, rose 0.7 per cent in mid-afternoon trading. Japan's Topix, the key index for Japan, finished lower by 1 per cent. Using these indices as broader proxies, and taking into account today's currency moves, China's total market cap has now grown to $4.480tn, while Japan's has slipped to $4.478tn (see charts below).
The Shanghai market has rallied 24 per cent this year, including a 14.5 per cent gain since late October when investors began to price in the launch of the Shanghai-Hong Kong Connect scheme, which for the first time allows international investors direct access to Shanghai stocks. China's market extended its rally this week after the People's Bank of China surprised markets with its first cut to benchmark interest rates in two years, spurring talk that will Beijing will offer further help as the economy cools.
The Japanese market has been rallying in recent months too, but weakness in the yen has robbed investors buying in dollars. The Topix is up nearly 7 per cent this year, but the yen has tumbled 11.4 per cent. As a result the Topix has fallen 4.1 per cent in US dollar terms.
Figures above and in the charts below are as of 3pm in Hong Kong - an hour after Japan's market closed. China's markets are still trading as of pixel time.
