China’s capital markets are increasingly isolated: Declining global investor interest inChina has pushed activity in the country’s equity capital markets to multi-decade lows, writes the Financial Times.

By the numbers: Mainland IPOs along with follow-on and convertible share offerings have brought in some USD 6.4 bn in the first four months of 2024, the lowest number ever recorded, while offshore fundraising stood at USD 1.6 bn for the period — the lowest in over two decades — and outbound M&A transactions came in at their lowest since 2005 at USD 2.5 bn.

Driving the slump: Mounting geopolitical Beijing-Washington tensions and shrinking levels ofactivity in China have seen international banks and firms avoid the country. On top of this, property developers — a former pillar of Asia’s high-yield bond market — have ceased international borrowing in the wake of a government crackdown on using debt to fund projects that unsettled their business models, writes the salmon-coloured paper.

But on the plus side: China’s economy grew at a faster-than-anticipated rate of 5.3% y-o-y in 1Q 2024, according to data from China’s National Bureau of Statistics out yesterday. Chinese firms, banks, and government borrowers have also issued USD 26 bn of international debt this year, up from USD 24 bn the year before, while mainland borrowing is up 17% y-o-y to USD 246 bn.

MARKETS THIS MORNING-

Asian markets are trending mainly lower, with the Shanghai Composite (+0.7%) the only outlier at dispatch time. US and European stock futures are little changed, with most major benchmarks up very slightly overnight after the S&P 500 notched yesterday its third day of losses.

ADX

9,194

-0.6% (YTD: -4.0%)

DFM

4,184

-1.4% (YTD: +3.1%)

Nasdaq Dubai UAE20

3,668

-1.6% (YTD: -4.5%)

USD : AED CBUAE

Buy 3.67

Sell 3.67

EIBOR

5.0% o/n

5.3% 1 yr

TASI

12,500

-1.6% (YTD: +4.5%)

EGX30

29,400

-0.7% (YTD: +18.1%)

S&P 500

5,051

-0.2% (YTD: +5.9%)

FTSE 100

7,820

-1.8% (YTD: +1.1%)

Euro Stoxx 50

4,916

-1.4% (YTD: +8.8%)

Brent crude

USD 90.14

+0.04%

Natural gas (Nymex)

USD 1.73

+2.4%

Gold

USD 2,408

+1%

BTC

USD 63,950

+1.2% (YTD: +110.2%)

THE CLOSING BELL-

The ADX fell 0.6% yesterday on turnover of AED 1.2 bn. The index is down 4.0% YTD.

In the green: Presight AI Holding (+15%), Chimera (+8.2%) and Easy Lease Motorcycle Rental (+7.7%).

In the red: Emirates Stallions Group (-4.0%), Multiply Group (-3.7%) and Sharjah Cement Industrial Development (-3.5%).

Over on the DFM, the index closed down 1.4% on turnover of AED 499.9 mn. Meanwhile, Nasdaq Dubai fell 1.6%.

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