FX.co ★ China Stocks Dip on Geopolitical Tensions, Policy Uncertainty

The Shanghai Composite index declined by 0.2% to approximately 3,380, while the Shenzhen Component saw a slight decrease of 0.1% to 10,165 on Thursday. These downturns erased prior session gains, largely due to rising global tensions. Market jitters were fueled by reports suggesting the United States is preparing for a possible attack on Iran, which could occur over the upcoming weekend. Iran’s Supreme Leader, Ayatollah Ali Khamenei, issued a warning about the "irreparable damage" the U.S. may face should it intervene in the ongoing conflict between Israel and Iran. On the domestic front, the absence of new policy initiatives from top regulators at the Lujiazui Forum further dampened investor morale. Attention has now shifted to the July Politburo meeting in hopes of receiving stronger economic support measures. In addition, the People's Bank of China is expected to release its latest loan prime rate decision later this week, with analysts predicting no changes. Among individual stocks, Huafon Microfibre dropped by 5%, Hebei Changshan fell by 12%, and Rongfa Nuclear decreased by 6%.