Stimulus measures announced by China’s central bank helped boost the Australian stock market on Monday and pushed the index higher in afternoon trading after a weak start to the week.
The People’s Bank of China’s announced a “mix of measures” to support financial institutions, including a dedicated “green channel” to quickly help banks lending to businesses in the worst hit areas. It also relaxed some reporting requirements for banks in affected areas. Domestic inflation figures came out at 5.4 per cent, the highest level in eight years, due to rising food prices. This increase is mainly related to pork prices which have more than doubled as China dealt with the outbreak of swine flu.
China’s CSI300 index reached its highest level since falling 8 per cent last week, as workers partially returned to their jobs. Meanwhile, the Baltic Dry Index, which measures global shipping traffic, is sitting at a three-and-a half-year low of 415 points, down from 2500 points in September last year.
Locally, the S&P/ASX 200 index closed 0.1 per cent lower at 7012.5 points, as reporting season delivered some positive surprises, including a surprisingly good result from electronics retailer JB Hi-Fi, which saw shares jump as high as $46.09 during the day.