China Market extends gain

The Mainland China share market higher on Wednesday, 29 April 2020, as investors cheered solid factory data and reports that a clinical trial of experimental antiviral drug remdesivir in the United States showed positive results in treating COVID-19 patients. At closing bell, the benchmark Shanghai Composite Index advanced 1.33%, or 37.64 points, to 2,860.08. The Shenzhen Composite Index, which tracks stocks on China's second exchange, rose 1.88%, or 32.62 points, to 1,763.36. The blue-chip CSI300 index added 1.18%, or 45.55 points, to 3,912.58.

Investor sentiment around the world was brightened by Gilead Sciences Inc.'s announcement that preliminary results of a coronavirus drug trial showed at least 50% of patients treated with a five-day dosage of remdesivir improved and more than half were discharged from the hospital within two weeks. Later Wednesday, White House health advisor Dr. Anthony Fauci said NIAID's remdesivir drug trial, which enrolled about 800 patients, showed quite good news and that the drug would set a new standard of care for Covid-19 patients. Globally, the coronavirus pandemic has infected more than 3.1 million and taken at least 226,771 lives, according to data compiled by John Hopkins University.

In addition, investors welcomed the U.S. Federal Reserve's decision to maintain its accommodative policy during a two-day Federal Open Market Committee meeting through Wednesday. The US Federal Reserve said it would continue with its aggressive policy stance until it is comfortable that the economy is back on its feet. The Fed held its interest rate target between 0% and 0.25%. The Federal Open Market Committee said in its post-meeting statement that the ongoing public health crisis "will weigh heavily on economic activity, employment, and inflation in the near term," and pose considerable risks to the economic outlook over the medium term.

Players also took heart from China's official data showing manufacturing activity in the country expanded slightly in April. The official manufacturing Purchasing Managers' Index for April came in at 50.8, as compared to 52.0 in March. PMI readings above 50 signify expansion, while those below that mark indicate contraction. A subsequent private survey also released on Thursday, on the other hand, showed manufacturing activity in April contracting instead. The Caixin/Markit manufacturing PMI for April came in at 49.4.

CURRENCY NEWS: China's yuan was up against the dollar on Thursday, inline with firmer mid-point fixing by central bank. Prior to market opening, the People's Bank of China (PBOC) set the midpoint rate CNY=PBOC at 7.0571 per dollar, 133 pips or 0.19% firmer than the previous fix of 7.0704. In the spot market, onshore yuan CNY=CFXS was changing hands at 7.0586, 179 pips firmer than the previous late session close.

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