Asian Markets Are Mixed, China Faces Regulatory Pressures
11:30 AM EST – FOMC member Kashkari speaks
3:15 PM EST – FOMC member Kashkari speaks
After falling for two consecutive trading days, China’s Shanghai Composite Index started the week on a weaker note. Its price levels fell to a three-month low. The market has been weaker since last week amid increased regulations on China’s money markets. Regulators are increasing regulations on speculative trading and shadow banking.
Over the weekend, China’s insurance regulators announced that they would increase regulations on insurance companies with tighter risk controls. Regulatory pressure on insurance providers and speculators lowered the risk appetite in Chinese markets and triggered a sell-off by participants. Healthy economic data in the first quarter didn’t improve the market sentiment.
On April 24, the Shanghai Composite Index fell 1.4% and ended the day at 3,129.78. The SPDR S&P China ETF (GXC) closed at 82.71—a fall of 0.05% on April 21.
After falling last week, Hong Kong’s Hang Seng Index started the week on a positive note. Emmanuel Macron’s lead in the first round of France’s presidential election, as expected by the market, lowered market risk and supported the Hang Seng Index. On the other hand, increasing regulations in China dented the sentiment and limited profits. On April 24, the Hang Seng Index rose 0.41% and closed the day at 24,139.48. The iShares MSCI Hong Kong ETF (EWH) fell 0.58% to $22.28 on April 21.
After regaining strength last week, Japan’s Nikkei Index opened higher on Monday and started the week on a positive note. Lower market risk amid Emmanuel Macron’s win in the first round of France’s presidential election and weakness in the yen made the index rise on Monday. Nikkei closed the day at 18,875.88—a gain of 1.4%. The iShares MSCI Japan (EWJ) closed at 51.46—a gain of 0.37% on April 21. In the next part, we’ll see how European markets are performing on Monday.