China Stock Market Stabilizes Amid Regulations

Reuters – On Tuesday, China’s stock market saw the Shanghai Composite index nearly unchanged, closing at 2,932.39. This stability came after four consecutive days of declines. Traders were focused on understanding the new regulations set for non-banking financial institutions in China, which are expected to come into effect on May 1, 2024. Despite the day’s relative calm, the index lingered around its 13-month low, reflecting caution among investors. This wariness is partly due to the impending decision on the loan prime rate by the People’s Bank of China (PBoC) scheduled for Wednesday, as well as mixed economic activity data from mainland China in November. The observed economic fluctuations are attributed to weak demand and a continued downturn in policy.

Shanghai Composite Index – Daily Chart

Meanwhile, in the United States, stock futures showed little change. Investors were in a waiting mode, anticipating the release of the US Personal Consumption Expenditures (PCE) index, which is the Federal Reserve’s favored gauge of inflation. This data, expected later in the week, is significant as it influences the Fed’s monetary policy decisions.

In corporate news, Shenzhen L&A Design experienced a significant surge, jumping 20% to a two-year high. This increase came after an announcement that its subsidiary, Altron Engine Data Services, plans to invest CNY 435 million in computing servers. Other noteworthy movements in the market included CSSC Science & Tech, which climbed by 5.6%, and Kangxin New Materials, which saw a 3.3% rise. On the flip side, Jiangsu Boxin Investing and Citychamp Dartong Co faced declines of 7.2% and 2.3%, respectively.