Stock market support for China may be tested at the 3,700 mark on Wednesday.
The Asian stock market on Wednesday is expected to show mixed performance, with technology stocks providing some upward momentum while other sectors, such as Chinese broader indices, face selling pressure. This trend is a result of a weak global forecast and ongoing trade tensions.
Technology stocks in Asia are advancing, driven by anticipation around Nvidia’s earnings report and continued strong interest in artificial intelligence (AI) stocks. This sector strength is lifting Asian tech equity gauges by about 0.7%. Notable gains have been seen in Chinese AI company Cambricon, which rose by 8.2%, and a 21% surge in Nikon shares.
Outside of tech, broader Asian markets, including key Chinese indices, are weaker or sliding. This cautious sentiment is underpinned by slower industrial profit growth in China and the impact of global trade tensions.
Oil prices remain flat, neither providing a tailwind nor significant drag on energy-related sectors in the region.
Global factors such as new U.S. tariffs on India and macroeconomic concerns (e.g., Australia's hotter-than-expected CPI) add to the uncertain environment, likely restraining broader market appetite except in select tech and AI sectors.
In the United States, the Dow benefitted from a surge by shares of Home Depot, which shot up 3.2 percent. Meanwhile, Agricultural Bank of China strengthened 1.30 percent.
Traders are looking forward to the release of the Federal Reserve's latest monetary policy meeting minutes later today. The Shanghai Composite Index (SCI) finished at 3,727.29, just beneath the 3,730-point plateau. The SCI dipped 0.74 points or 0.02 percent for the day. The Shenzhen Composite Index rose 2.58 points or 0.11 percent to end at 2,343.74.
The NASDAQ experienced a slump, primarily due to weakness in the tech sector. Shares of Nvidia (NVDA) plunged by 3.5 percent following reports about a new AI chip development for China.
The China stock market ended Tuesday with a loss, snapping a two-day winning streak. The Industrial and Commercial Bank of China collected 0.53 percent on Tuesday, while Jiangxi Copper retreated 1.49 percent. Aluminum Corp of China (Chalco) skidded 1.17 percent, and China Life Insurance tanked 2.45 percent.
The Jackson Hole Economic Symposium is set to begin on Thursday. Federal Reserve Chair Jerome Powell is scheduled to speak at the symposium on Friday. His remarks could potentially impact the outlook for interest rates.
Crude oil declined on Tuesday due to supply side concerns from OPEC unwinding 2.2 million barrels per day in voluntary cuts. West Texas Intermediate crude for September delivery was down $1.07 or 1.69 percent at $62.35 per barrel.
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