China New Home Prices Highest in 2 Years

Trading Economics: Average prices of new homes in 70 Chinese cities increased by 7.9 percent year-on-year in July of 2016 from 7.3 percent in June. It was the 10th straight month of gain and the fastest rise since February 2014. In Beijing, prices rose 20.7 percent and in Shanghai went up 27.3 percent. On a monthly basis, new home prices rose 0.8 percent, the same pace as in the preceding month, which was the slowest since April, according to Reuters. Out of 70 cities surveyed, prices stalled or fell in 19 cities in July, compared to 15 in June. Housing Index in China averaged 2.14 percent from 2011 until 2015, reaching an all time high of 9.90 percent in November of 2013 and a record low of -6.10 percent in March of 2015. Housing Index in China is reported by the National Bureau of Statistics of China.

Alan Jin, a property analyst for Asia ex-Japan at Mizuho Securities, said the rally in prices in tier-one cities was way above sustainable levels.

"We think this rally is purely driven by liquidity, excess liquidity. It's a global phenomenon, but in China this is happening together with veryweak macro-economic growth backdrop so we are quite concerned. In the next year, we think the GDP data, etc, will be pretty weak," Jin told CNBC's "Squawk Box."

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In Asian Equity Markets stocks are on track for their biggest single-day rise in nearly two weeks while the greenback retreated after minutes of the U.S. Federal Reserve's latest meeting showed that the chances of a September rate hike are looking pretty slim. MSCI's broadest index of Asia-Pacific stocks outside Japan was up 0.7 percent, its biggest rise since Aug. 8. The Nikkei fell 0.5 percent to 16,665.00 in mid-morning trade after falling to as low as 16,560.20 earlier, the lowest since August 8. The broader Topix fell 0.5 percent to 1,304.14 and the JPX-Nikkei Index 400 declined 0.6 percent to 11,735.89. Hong Kong stocks were the top gainer in Asia with a 1 percent rise.

In Currency Markets the dollar hit a seven-week low against a basket of major currencies on Thursday, after minutes from the Federal Reserve's July meeting showed policy committee members opposed to a near-term rate hike outnumbered those who wanted one. The yen edged up 0.2 percent to 100.10 per dollar. The euro hit a seven-week high of $1.13285  and last traded at $1.1301, up 0.1 percent on the day. Sterling held steady at $1.3043. The dollar's index against a basket of six major currencies touched a low of 94.385, its weakest level since June 24. The dollar index last stood at 94.627, having lost 1.1 percent so far this week.

In Commodities Markets oil prices fell in early trading on Thursday as the prospect of record Saudi output weighed on markets and as traders cashed in on profits following an almost uninterrupted price rally this month of nearly 20 percent. International Brent crude oil futures were trading at $49.67 per barrel, down 18 cents from their last close. In the United States, WTI crude futures were at $46.79 a barrel, flat with its last close.  Spot gold was up 0.4 percent at $1,353.06 an ounce. Silver was up 1 percent at $19.86 an ounce on Thursday, after touching an over three-week low the day before. Platinum rose 1.6 percent to $1,130.60, after hitting a new three-week low of $1,099.74 in the previous session. Palladium was up 1 percent at $699.80.

In US Equity Markets  stocks ended slightly higher on Wednesday after minutes from the Federal Reserve's last policy meeting showed voting members divided over whether to raise interest rates soon. The Dow Jones industrial average closed up 0.12 percent, to 18,573.94, the S&P 500 had gained 0.19 percent, to 2,182.22 and the Nasdaq Composite had added 0.03 percent, to 5,228.66. Shares of Target were down 6.4 percent while Lowe's was down 5.6 percent after they cut full-year earnings forecasts. Cisco fell 1.3 percent after technology news site CRN reported the company is laying off employees. After the bell, Cisco edged even lower following its results and its announcement to lay off 5,500 employees, or nearly 7 percent of its work force.

In Bond Markets  Japanese government bond prices rose on Thursday, lifted by a weaker Nikkei and firmer U.S. Treasuries. The benchmark 10-year JGB yield was down half a basis point at minus 0.090 percent and the 30-year yield fell 1.5 basis points to 0.340 percent. In line with the decline in global debt yields, the five-year yield had fallen to a record low of minus 0.380 percent three weeks ago. The yield on 10-year Australian government debt edged lower to 1.95 percent, about 100 basis points down from end-2015.

Source: Institute of Trading and Portfolio Management