Asian Markets: Risk Appetite Improved on June 19
8:00 AM EST – US FOMC member Dudley speaks
11:00 AM EST – US FOMC member Dudley speaks
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China’s Shanghai Composite Index pulled back last week amid concerns about China’s economic stability. The Shanghai Composite Index started this week on a positive note by closing higher on Monday. The demand for undervalued blue-chip stocks in the Shanghai Exchange pushed the market higher on June 19.
Weaker-than-expected fixed investment data along with the slower housing market raised concerns about China’s economy in the coming months. However, signs of improved market liquidity supported the market on Monday. Last week, the Central Bank of China added 400 billion yuan of funds into the market through open market operations to improve liquidity in the market. Signs of fewer new listings in the coming months also supported the market.
On June 19, the Shanghai Composite Index rose 0.68% and ended the day at 3,144.37. The SPDR S&P China ETF (GXC) rose 0.17% to $87.67 on June 16.
After losing momentum last week amid the technology sector sell-off, Hong Kong’s Hang Seng Index started this week on a positive note by opening higher. Part of China and Hong Kong’s buying momentum is from expectations of an addition of Chinese stocks in the MSCI Index. The rise in insurance and retail stocks on Monday pushed the Hang Seng Index higher. On June 19, the Hang Seng Index rose 1.2% and closed the day at 25,924.55. The iShares MSCI Hong Kong ETF (EWH) fell 0.04% to $23.84 on June 16.
After falling for two consecutive trading weeks, Japan’s Nikkei Index started this week on a positive note by opening higher. The market regained its risk appetite on Monday because parliamentary elections in France ended on Sunday. Nikkei closed the day at 20,067.75 after rising 0.62%. The iShares MSCI Japan ETF (EWJ) closed at $54.22—a gain of 0.41% on June 16.
In the next part, we’ll discuss how European markets performed in the morning session on June 19.