China’s Shanghai Composite Index lost strength on Thursday and declined to fresh two-year low price levels. Carrying forward the weakness, the Shanghai Composite Index opened lower on June 22. However, the Shanghai Composite Index regained strength as the day progressed and closed higher.
China’s market sentiment is weak this week. Trade war concerns between the US and China escalated, which led to increased caution in the market. The People’s Bank of China decided to cut banks’ reserve requirement ratios, which helped the market to pause the downfall on Wednesday. However, the move didn’t reverse the market direction. Following US markets’ decline overnight, the Shanghai Composite Index opened lower on Friday. The market rebounded as the day progressed amid strength in the media, software, and computer services sectors. Oil prices’ recovery on Friday helped China’s oil equipment services and distribution sector and the market close with gains.
On June 22, the Shanghai Composite Index gained 0.49% and closed the day at 2,889.95. The SPDR S&P China (GXC) fell 2.0% on Thursday.
Hong Kong’s Hang Seng Index declined on Thursday amid the downgrade from Morgan Stanley and US-China trade war concerns. On June 22, the Hang Seng Index opened lower amid the pullback in US markets and decreased global market risk appetite. However, the Hang Seng Index regained stability amid a recovery in China’s major market indices on Friday.
On June 22, the Hang Seng Index gained 0.19% and closed the day at 29,351.00. The iShares MSCI Hong Kong (EWH) declined 1.9% on Thursday.
After gaining for two consecutive trading days, Japan’s Nikkei Index opened lower on Friday and closed the day with losses. China’s warning about import tariffs on car imports from the US made Daimler cut its profit forecast. The warning dented the market sentiment on Japanese automakers and weighed on the Nikkei Index on Friday.
The Nikkei Index fell 0.65% and closed the day at 22,545.00 on Friday. The iShares MSCI Japan (EWJ) fell 0.37% on Thursday.
Next, we’ll discuss how US markets performed on June 21.