We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bearish
Oil - US Crude
Mixed
Wall Street
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Mixed
USD/JPY
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • With the risk appetite charge this week and the particular performance from US indices, I wanted to overlay US GDP (annualized) over the Log scale of the Wilshire 5000 (Fed doesn't have Dow/SPX back far enough) to show fundamentals are not steering this boat https://t.co/bXtc7nSCQq
  • 🇺🇸 Consumer Credit Change Actual: $-68.78B Expected: $-20B Previous: $-12.1B https://www.dailyfx.com/economic-calendar#2020-06-05
  • Nasdaq 100 Sets Fresh All-Time-Highs, US Stocks Jump on Jobs Report https://www.dailyfx.com/forex/fundamental/daily_briefing/session_briefing/daily_fundamentals/2020/06/05/Nasdaq-100-Sets-Fresh-All-Time-JS-High-US-Stocks-Jump-on-Strong-Jobs-Report.html https://t.co/SKiFAIEgMa
  • #Nasdaq: The market rising vertically into the top-side line and it also roughly matching the psychological 10k threshold (10100/200), we have the perfect recipe for a significant inflection point. Get your Nasdaq market update from @PaulRobinsonFX here: https://t.co/e248c13kKI https://t.co/g0nllIycxl
  • So long as the market's keep going up, there is less reason for the administration not to take more drastic action to pursue options to leverage near-term growth through policies like protectionism https://t.co/HPUmh5v83V
  • Heads Up:🇺🇸 Consumer Credit Change due at 19:00 GMT (15min) Expected: $-20B Previous: $-12.1B https://www.dailyfx.com/economic-calendar#2020-06-05
  • President Trump says the EU charges US seafood tariffs it doesn't charge Canada, threatens EU auto tariff if the EU does not lower lobster levy Just when things were settling down somewhat, it seems we now have the possibility of a US-EU trade war $DAX $SPY
  • Trump threatens auto tariffs on the EU in response to the levy on lobsters - BBG
  • Rising confidence: US 10-Y yield most since MAR 20 #Gold fell to lowest since mid-April #NFP #XAUUSD https://t.co/F04ZibU3jB
  • Commodities Update: As of 18:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: -0.29% Silver: -1.94% Gold: -2.00% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/HJrG1dsfDg
China's Market News: Chinese Authorities Address Stock, Commodities Plunge

China's Market News: Chinese Authorities Address Stock, Commodities Plunge

2016-05-09 16:26:00
Renee Mu, Currency Analyst
Share:

This daily digest focuses on market sentiment, new developments in China’s foreign exchange policy, changes in financial market regulations and Chinese-language economic coverage in order to keep DailyFX readers up-to-date on news typically covered only in Chinese-language sources.

- Chinese commodities plunged on Monday, with five major commodities hitting the daily limit-down levels.

- Shanghai Composite fell by -2.79% on Monday while the ChiNext Board dropped by -3.55%.

- Government policies are being aimed at normalizing financial markets rather than maintaining growth, according to an official newspaper.

To receive reports from this analyst,sign up for Renee Mu’ distribution list.

Sina News: China’s most important online media source, similar to CNN in the US. They also own a Chinese version of Twitter, called Weibo, with around 200 million active usersmonthly.

- Chinese commodities plunged on Monday, with a drop of over -6% in rebar (a steel product), a -5% drop in hot rolled steel and over a -4% drops in coking coal and iron ore. Speculative funds have rushed into commodity markets in April and drove prices to new highs. Chinese regulators warned that excessive speculation may result price bubbles, and in-turn and introduced tightened rules designed to cool down the rampant volatility.

- The Shanghai Composite Index fell by -2.79% on Monday and broke 2,900 level for the first time in 6 weeks. The ChiNext Board tumbled by -3.55% over the same session. Over 100 stocks in Shanghai and Shenzhen stock exchanges hit the daily limit-down levels.

The headline news on People’s Daily may help explain the drops seen in both markets.

People's Daily: the official paper of the Communist Party.

- The newspaper published a headline article on May 9th addressing China’s economy and financial markets. Within the article, they said “China’s Economic Trend in the Current and Following Periods is L-shaped, rather than U-shaped and is Definitely Not V-shaped,” due to weak demand and overcapacity. The paper went on to say that a temporary rebound will not lead to continued high growth like what the economy had seen in previous years.

The newspaper quoted an authoritative person’s comment that China “cannot and does not need to use persistent stimulus to promote the economy as it will cause price bubbles.” This “defines the target of government policies over the equity, foreign exchange and real estate markets, which is to help them return to normal, rather than maintaining growth”. Also the government should avoid injecting massive liquidity to stimulate the economy in the short-term as it will cause long-term issues.

This means additional drops in equities and commodities are likely to be seen over the following periods while the government withdraws funds and lets the markets come back to a more natural balance. The earning reports of listed companies show that the Chinese government has bought a significant amount of Chinese shares in the effort of supporting the market.

SAFE News: China’s foreign exchange regulator.

- In the first quarter of 2016, the net foreign investment in Chinese financial institutions increased to 3.50 billion Yuan from 1.08 billion Yuan in the previous quarter. The net Chinese investment in overseas financial institutions dropped to 11.61 billion yuan from 43.39 billion yuan in the previous quarter.

China Finance Information: a finance online media administrated by Xinhua Agency.

- The State Council released 14 measures in the effort to promote trade sectors. It includes using targeted reserve requirement ratios and targeted interest rates to support small enterprises and encouraging companies that conduct trade processing to move to the Midwest. The authority said the country is facing increasing downward pressure in trade. According to a report released by China’s Customs on May 7, China’s imports fell -5.7% in April from a -2% drop in March; exports fell -1.8% from a 11.5% increase in March.

Written by Renee Mu, DailyFX Research Team

To receive reports from this analyst,sign up for Renee Mu’ distribution list.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.