Shanghai stocks record best week in five on stimulus hopes

Shanghai stocks slid on Friday on bleak factory gate data that pointed to a prolonged recovery, but ended the week with their biggest gains in five on hopes of more economic stimulus to shore up the world's second-largest economy.

The blue-chip CSI300 index fell 0.6%, to 3,769.18, while the Shanghai Composite Index shed 1% to 2,796.63 points.

For the week, CSI300 gained 1.5%, while SSEC advanced 1.2%, its biggest weekly gain since the week of March 6.

At 07:15 GMT, the yuan was quoted at 7.0336 per US dollar, 0.15% firmer than the previous close of 7.044. As of 07:16 GMT, China's A-shares were trading at a premium of 25.95% over the Hong Kong-listed H-shares.

China's factory gate prices fell the most in five months in March, with deflation deepening and set to worsen in coming months as the economic damage wrought by the coroanvirus shuts down many countries.

Analysts expect a deep first-quarter economic contraction in China and have grown increasingly pessimistic about the country's prospects for 2020 due to the pandemic's sweeping global impact.

China's foreign trade faces unprecedented challenges due to the pandemic that has spread to more than 200 countries, China's assistant commerce minister said on Friday, amid growing fears of a deep global recession.

In an effort to ease labour shortages and boost consumption, China will loosen residency rules this year to make it easier for people in rural areas to move to small cities.

Beijing has already rolled out a series of fiscal and monetary support steps, and sources have told Reuters that policymakers are readying more stimulus to stabilise growth and prevent mass unemployment.

Meanwhile, the US Federal Reserve and the Bank of England ramped up their emergency responses on Thursday as they pushed deeper into territory once considered fraught with risk for central bankers.

China on Friday reported a fall in new coronavirus cases, particularly imported and asymptomatic infections which authorities fear could see a second wave of COVID-19 as city and travel restrictions are lifted.