China Stocks Rallying On "Stealth Stimulus" Loan From Agricultural Bank To Shanghai
Making headlines overnight was news that the state owned Agricultural Bank would be giving a massive loan to Shanghai to be used to complete its Disneyland. The move has shown increased confidence in consumer spending and increased willingness to invest in the region.
The loan itself also raised eyebrows, as it comes in at roughly 7 percent of the GDP of Shanghai, and represents a massive capital injection.
Stocks with heavy Chinese exposure have been on a run this morning, with Freeport McMoran (NYSE: FCX) gaining just under 1 percent, Caterpillar (NYSE: CAT) rising over 1.5 percent, and Deere & Company (NYSE: DE) gaining just under 1 percent.
Pure China plays were on a much stronger run, with E-Commerce China Dangdang (NYSE: DANG) up 6.5 percent, Mecox Lane (NASDAQ: MCOX) up 37.72 percent, while the China ETF (NYSE: FXI) was up 3.04 percent.
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