Mid-Week Wrap: 24th January 2024
24 J A N U A R Y 2 0 2 4 • I S S U E 7
Market Mood
This week, amid the ongoing bull market in US stocks, attention turns to the significant challenges faced by Chinese stocks. The Hang Seng China Enterprises index experienced a sharp 2.4% decline on Monday, nearly reaching its lowest point since 2005. China grapples with a housing slump and increasing deflation, as reflected in the CSI 300 index hitting a five-year low on Monday. Premier Li Qiang has urged "forceful" measures to restore confidence, amid concerns that a Chinese stock market crash may lead to social instability and bank runs. Although the market showed a modest rise on Tuesday, driven by discussions of a potential 2 trillion-yuan rescue package, we remain cautious, as any recovery is anticipated to be a prolonged process spanning several months.