March 20, 2020 / 7:54 AM / 16 days ago

China's blue-chip index posts worst week in 17 months on coronavirus worries

SHANGHAI, March 20 (Reuters) - China stocks rose on Friday, tracking a rebound in other Asian markets, though the country’s blue-chip index still posted its steepest weekly loss in 17 months on persisting worries over the economic damage from the coronavirus outbreak.

** The blue-chip CSI300 index rose 1.8%, to 3,653.22, while the Shanghai Composite Index ended up 1.6% to 2,745.62.

** For the week, CSI300 was down 6.2%, its biggest weekly decline since October 2018, while SSEC retreated 4.9%, as countries came to a standstill and business activities shutdown due to the virus.

** To blunt the virus’ hit, nations have poured ever-more-massive amounts of stimulus into their economies and central banks have flooded markets with cheap dollars to ease funding strains.

** China kept its benchmark lending rate unchanged on Friday defying expectations for a cut to ease borrowing costs in an economy jolted by the virus.

** Still, the country is set to unleash trillions of yuan of fiscal stimulus to revive an economy expected to shrink for the first time in four decades, four policy sources told Reuters.

** China’s coronavirus infections from abroad hit a new daily record on Thursday, pressuring authorities to hold the bar high on already tough custom rules and public-health protocols.

** Further downside risk for the A-share market is limited, given its low valuations and Beijing’s effective virus control and sufficient policy tools, said Fu Yanping, analyst at China Galaxy Securities, in a report.

** As of 0720 GMT, China’s A-shares were trading at a premium of 31.92% over the Hong Kong-listed H-shares.

** Around the region, MSCI’s Asia ex-Japan stock index was firmer by 4.56%, while Japan’s Nikkei index closed down 1.04%.

** At 0719 GMT, the yuan was quoted at 7.0652 per U.S. dollar, 0.66% firmer than the previous close of 7.1119. (Reporting by Luoyan Liu and Andrew Galbraith; Editing by Amy Caren Daniel)

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