Stocks in China fall after CPI, producer price jump

Stocks in China fall after CPI, producer price jump

SYDNEY, NSW, Australia - Stocks in China fell on Monday after the consumer price index and producer price indexes went up.

In March, China's producer price index jumped 8.3 percent compared to March last year. This was well ahead of the 7.9 percent forecast.

The CPI was up to 1.5 percent in the year-on-year, which is higher than the 1.2 percent expected.

Ramiz Chelat, portfolio manager at Vontobel Asset Management, told CNBC that the big gap between CPI and PPI indicates that pricing power amongst most companies in China is weak and they're taking a hit on margins.

He said that due to the infectiousness of omicron, we could see more localized lockdowns being a recurring theme. We think you need to be very selective in China, and look for companies that can deliver in a growth-challenged environment. A Chinese property developer Zhenro Properties advised regulators on Monday that they had missed two bond interest payments and were likely to miss more.

The Hang Seng in Hong Kong was still trading, down more than 700 points in the final hour of trading.

The Shanghai Composite fell by 84.72 points or 2.61 percent to close Monday at 3,167. In Japan, the Nikkei 225 plunged 164.28 points or 0.61 percent to 26,851. In New Zealand, the S&P NZX 50 lost 134.24 points or 1.11 percent to 11,932. The Australia All Ordinaries was the only major index to increase, adding just 1.20 points or 0.02 percent to 7,773. The buyers of bank and mining stocks kept their sellers at bay.

The data came out of China was good for the U.S. dollar. The euro fell to 1.0880. The British pound fell to 1.2991. The Japanese yen was weakened to 125.40. The Swiss franc fell to 0.9367.

The Australian dollar was down to 0.7428.