Next Week in China: 27 April-1 May 2026

Major Data Releases:

• 27 April: China to conduct March medium-term lending facility (MLF) operation for banks and set borrowing rates
• 27 April: China to report March industrial profits
• 28 April: Hong Kong to report March external merchandise trade statistics
• 29 April: China to report Q1 2026 business revenue of enterprises above the designated size engaged in culture and related industries
• 30 April: China to release April manufacturing Purchasing Managers’ Index (PMI)
• 30 April: RatingDog to report April manufacturing PMI for China
• 30 April: Macau to report March external merchandise trade data
• 30 April: Taiwan to report Q1 2026 GDP estimate

The pace of major data releases is set to normalise in the coming weeks. On 1 May, the Hong Kong, Mainland China, and Taiwan stock exchanges will be closed for the Labour Day public holiday.

For PMI, we expect the headline manufacturing figure to soften from March, potentially slipping below the 50 boom-bust threshold. That said, the Emerging Industries Purchasing Managers’ Index (EPMI) remained notably resilient: the April EPMI for strategic industries edged down by just 0.2 points month-on-month to 57.4, well above its seasonal norm as it typically declines by an average of 1.1 points given that March and April are both peak restart months. April conditions are usually marginally weaker, but this year’s reading is relatively firm.

At the margin, demand improved more than supply, pointing to a more favourable supply-demand balance in emerging industries. On the supply side, the production index rose by 0.2 points month-on-month while the purchasing index was unchanged, suggesting production intensity remains solid. Meanwhile, on the demand side, new orders and new export orders increased by 0.9 and 4.8 points from March, respectively. Consistent with a seasonal pickup, production remained firm but the supply-demand mix improved meaningfully: the production-to-demand gap narrowed to 1.0 from 1.7, well below the 2022-2025 seasonal average. Meanwhile, the EPMI loan difficulty index rose by 1.2 points, likely reflecting slightly tighter financing conditions. Although seasonal patterns still point to a month-on-month easing in the manufacturing PMI, April’s reading may log higher than seasonal norms also due to marginal gains in high-frequency indicators for exports and property sales, which could provide spillover support to traditional sectors.

On liquidity, RMB 600 billion (USD 87.9 billion) in 1-year MLF credit and RMB 500 million (USD 73.2 million) in 7-day reverse repos will mature on 27 April. We expect China’s central bank to maintain an over-roll, thereby adding medium- to long-term money supply. April funding conditions face several seasonal drains, including the peak tax payment period, continued government bond supply, and credit-related funding needs. However, April is typically a light month for government bond issuances, suggesting the liquidity impact from such should be manageable. In addition, the outstanding stock of medium-to-long-term funding excluding Treasury bond trading remains at a record high of RMB 14.4 trillion (USD 2.1 trillion), easing the central bank’s burden in stabilising liquidity. On balance, overall funding conditions in April are likely to loosen in line with seasonal patterns.

Equity market performance was mixed over the past week. As of Thursday, 23 April, the MSCI China Index was down 1.86 per cent while the Shanghai Composite rose by 1.03 per cent. The Shenzhen Component and ChiNext indices outperformed, gaining 1.06 per cent and 1.14 per cent, respectively. Large caps outperformed small and mid caps, with growth stocks modestly ahead of value peers.

Market sentiment is likely to remain sensitive to geopolitical headlines while international oil prices continue to face price volatility. Nonetheless, domestic economic resilience, a gradual lift in inflation, and improving relative attractiveness of renminbi-denominated assets should remain supportive of A-shares over the medium term. Late April also marks the peak disclosure period for annual reports and first-quarter results — an important window to assess the extent of corporate earnings recovery — suggesting scope for selective, sector-specific positioning.

This piece has been co-produced with Yiyi Capital Limited in Hong Kong, a China specialist and a part of a global financial services group.