Asian Markets Are Weak before Central Bank Meetings




China’s Shanghai Composite Index rose at the beginning of last week but trimmed some of the gains by the end of the week. On Monday, the Shanghai Composite Index opened the day lower and closed the day with limited losses.

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Market sentiment

The Shanghai Composite Index rose last week amid the government’s stimulus to improve China’s economic growth. However, the gains were limited due to concerns about the US-China trade war. On Monday, the Shanghai Composite Index was stable amid reports that the government is increasing infrastructure spending. The reports strengthened infrastructure stocks, especially the Chinese makers. However, the market moved lower as the day progressed. The strength from infrastructure stocks was offset by weakness in healthcare firms. The recent vaccine scandal in China triggered a sell-off in healthcare stocks.

The market is looking forward to the release of China’s manufacturing purchasing managers’ index data. The data are scheduled to be released at 9:00 PM EST today. On July 30, the Shanghai Composite Index fell 0.12% and closed the day at 2,870.06. The SPDR S&P China (GXC) fell 0.47% on Friday.

Hong Kong

After regaining strength last week, Hong Kong’s Hang Seng Index started this week on a weaker note by closing lower on Monday. The Hang Seng Index opened lower on Monday following US markets’ weak performance at the end of last week. Caution ahead of Japan, the United Kingdom, and the US’s central bank meetings this week also weighed on the Hang Seng Index. Weakness in the commerce and industry, financial, and properties sectors dented the sentiment.

On July 30, the Hang Seng Index fell 0.45% and closed the day at 28,674.00. The Shares MSCI Hong Kong (EWH) fell 0.32% on Friday.


After gaining for three consecutive trading weeks, Japan’s Nikkei Index started this week on a weaker note by closing lower on Monday. The risk appetite is lower on Monday. The market was expecting a change in the policy by the Bank of Japan. Weakness in energy and pharma stocks weighed on the market. The Nikkei Index fell 0.75% and closed the day at 22,542.00. The iShares MSCI Japan (EWJ) rose 0.3% on Friday.

Next, we’ll discuss how the US Dollar Index and Treasury yields performed in the early hours on July 30.


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