The Direxion Daily FTSE China Bull 3X Shares (YINN), a leveraged exchange-traded fund tracking Chinese stocks, saw a remarkable pre-market surge of 12.62% on September 24, 2024. This significant gain came after the People's Bank of China (PBoC) unexpectedly cut interest rates and injected liquidity into the banking system on September 23, 2024.
In a surprise move aimed at supporting the Chinese economy ahead of the National Day Holiday, the PBoC lowered its 14-day reverse repo rate by 10 basis points to 1.85% and pumped CNY 74.5 billion into the banking system through this tool. Additionally, the central bank injected CNY 160.1 billion via 7-day reverse repos, keeping the rate unchanged at 1.7%.
The PBoC's easing actions, including the rate cut and liquidity injection measures, were seen as a positive catalyst for Chinese stock markets. Following the central bank's announcement, the Shanghai Composite rose 0.4%, and the Shenzhen Component climbed 0.5% on Monday, September 23, 2024.
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