Trade Talk Optimism Lifts China Stocks Amid Factory Deflation Concerns
Mainland China stocks saw slight gains following U.S. President Trump's positive remarks on trade talks with China, although factory deflation limited the rise. Trump announced new tariffs on various imports, refraining from involving China, potentially boosting short-term market sentiment. Deepening producer deflation in China remains a concern.
- Country:
- China
Mainland China's equities experienced a modest uplift on Wednesday in response to U.S. President Donald Trump's positive comments regarding ongoing trade discussions with Beijing. However, the upward trajectory was capped by factory deflation, reflecting manufacturers cutting prices amidst fragile demand.
At mid-session, the Shanghai Composite index posted a 0.3% rise, with the blue-chip CSI300 index advancing 0.32%. Conversely, Hong Kong's stocks showed downward momentum. Trump announced a 50% tariff on copper imports alongside looming levies on semiconductors and pharmaceuticals, exacerbating his extensive trade confrontations.
Echoing optimism about trade talks, Trump detailed cordial relations with China and an upcoming tariff note to the EU. Analyst Deng Lijun suggested Sino-U.S. trade tension ease might uplift A-share risk appetite following possible tariff agreements, despite China's worsening producer deflation raising policy concerns.
(With inputs from agencies.)
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