The China stock market experienced a positive rebound on Tuesday, recovering after a brief dip that interrupted a two-day upward streak, during which it gained almost 40 points or 1.2 percent. The Shanghai Composite currently hovers just above the 3,420-point mark; however, it is anticipated to face some pressure as markets open on Wednesday.
Globally, the forecast for Asian markets is generally negative, with expected declines impacting primarily the technology, semiconductor, and housing sectors. This outlook follows similar downturns observed in both European and U.S. markets, suggesting Asian exchanges may follow suit.
On Tuesday, the Shanghai Composite Index saw modest increases, driven by gains from financial and property shares, despite being tempered by downturns in the oil sector. Specifically, the index rose by 20.13 points, equating to a 0.59 percent increase, closing at 3,422.66. The index had fluctuated between 3,417.77 and 3,494.87 during the trading session. The Shenzhen Composite Index also experienced a rise, adding 17.84 points or 0.87 percent, to conclude at 2,075.17.
Among the notable performers, Industrial and Commercial Bank of China strengthened by 1.58 percent, Bank of China advanced by 1.17 percent, and China Construction Bank increased by 1.45 percent. Meanwhile, China Merchants Bank surged by 2.39 percent, Agricultural Bank of China went up by 0.80 percent, and China Life Insurance made gains of 0.36 percent. Other notable movements included Jiangxi Copper and Gemdale both rising by 0.37 percent, Aluminum Corp of China (Chalco) increasing by 0.39 percent, and various declines in energy-related stocks such as Yankuang Energy, PetroChina, and Sinopec.
In contrast, Wall Street showed signs of weakening. Major indices opened the week flat, maintaining this status for much of the day before a downward correction occurred toward the session's end. The Dow Jones Industrial Average dropped by 154.10 points or 0.35 percent, closing at 44,247.83, while the NASDAQ fell by 49.45 points or 0.25 percent, landing at 19,687.24. The S&P 500 also saw a decline of 17.94 points or 0.30 percent, ending at 6,034.91.
Market softness in the U.S. was largely driven by profit-taking as traders capitalized on previous gains, ahead of the anticipated release of the Labor Department's consumer price inflation report. This data release could significantly influence the Federal Reserve's future monetary policy decisions, despite expectations of a 25 basis point rate cut at the upcoming meeting.
According to the CME Group's FedWatch Tool, there is currently an 86.1 percent probability that the Federal Reserve will implement this quarter-point rate cut, with a 69.1 percent chance that rates will remain unchanged through late January.
Oil futures settled on a positive note on Tuesday, buoyed by expectations of increased demand from China following the Chinese government's recent stimulus announcements. Specifically, West Texas Intermediate Crude oil futures for January climbed by $0.22 or 0.32 percent, closing at $68.59 per barrel.
