China's central bank has pledged it would use tools to support key sectors, having already pumped billions of dollars into the money market to stabilise confidence. Sentiment was supported by comments from central bank advisor Ma Jun that China should consider lowering benchmark deposit rate to enable banks to reduce lending rates for businesses.
More than 300 Chinese companies are seeking bank loans totalling at least 57.4 billion yuan ($8.2 billion) to help cope with the disruption,
The death toll from the coronavirus epidemic in mainland China soared past 1,000 on Tuesday with a record daily rise in fatalities, although the number of new confirmed cases fell. There were 2,478 new confirmed cases in mainland China on Feb. 10, down from 3,062 on the previous day, bringing the total to 42,638. Investors became more confident as the number of newly confirmed cases outside epicentre Hubei province dropped.
In mainland markets, sectors that rose included glass, by 3.5%, Apple supply chain, by 2.2%, wireless headsets, by 2%, liquor, by 2.5%, and steel, by 2.1%. Apple AirPod supplier Luxshare Precision Industry closed ahead by 5.3% at 45.50 yuan. Kweichow Moutai, the world's most valuable liquor company, rose nearly 3% to 1,098 yuan.
CURRENCY NEWS: China's yuan was up against the dollar on Tuesday, on expectations Beijing will add further liquidity into the financial system to help lessen the blow of the deadly coronavirus. Prior to market opening on Tuesday, the People's Bank of China (PBOC) set the midpoint rate CNY=PBOC at 6.9897 per dollar, 34 pips or 0.05% weaker than the previous fix of 6.9863. The spot market CNY=CFXS opened at 6.9750 per dollar and was changing hands at 6.9779 at midday, 96 pips firmer than the previous late session close.
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