Chinese stocks rise slightly as markets await Trump’s re-inauguration
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Chinese equities began the week on a positive note, with the Shanghai Composite Index gaining 0.08% to close at 3,244.38 and the Shenzhen Component Index rising 0.94% to 10,256.40. The modest gains reflect cautious optimism amid the re-inauguration of Donald Trump as President of the United States.
Key drivers behind market movement
Chinese Vice President Han Zheng expressed hope that US companies would deepen their engagement in China to improve bilateral relations. Han’s presence at Trump’s inauguration, representing President Xi Jinping, marks a shift in tone, as previous US inaugurations were only attended by Chinese ambassadors.
The Trump administration’s prior tariffs on $300 billion of Chinese goods remain a focal point for markets. Trump’s invitation to Xi for his second inauguration, described as a "conciliatory move" by Reuters, has added to market speculation about potential shifts in US-China relations.
The People’s Bank of China retained its one-year Loan Prime Rate at 3.1% and the five-year LPR at 3.6%, signaling stability in monetary policy. The International Monetary Fund’s recent acknowledgment of China’s 5% economic growth—above its 4.8% forecast—also provided a supportive backdrop for Chinese stocks.
Corporate highlights
CATL shares surge
Shares in CATL soared 6% following the company’s legal action against CALB for alleged patent infringement on battery modules. This development underscores CATL’s position as a leader in the battery manufacturing sector and its focus on protecting intellectual property.
TikTok back online
TikTok resumed operations after Trump extended the deadline for ByteDance to divest its US operations. Reports suggest a planned joint venture where US owners would hold a 50% stake, signaling potential resolution to the platform’s regulatory challenges.
Market outlook
As markets digest the implications of Trump’s re-inauguration, investors remain cautiously optimistic. The combination of stable monetary policy, improving US-China diplomatic signals, and corporate developments like CATL’s performance provide a mixed but hopeful narrative for Chinese equities. Further clarity on trade and economic policies from the new US administration will likely shape near-term market direction.
Key drivers behind market movement
Chinese Vice President Han Zheng expressed hope that US companies would deepen their engagement in China to improve bilateral relations. Han’s presence at Trump’s inauguration, representing President Xi Jinping, marks a shift in tone, as previous US inaugurations were only attended by Chinese ambassadors.
The Trump administration’s prior tariffs on $300 billion of Chinese goods remain a focal point for markets. Trump’s invitation to Xi for his second inauguration, described as a "conciliatory move" by Reuters, has added to market speculation about potential shifts in US-China relations.
The People’s Bank of China retained its one-year Loan Prime Rate at 3.1% and the five-year LPR at 3.6%, signaling stability in monetary policy. The International Monetary Fund’s recent acknowledgment of China’s 5% economic growth—above its 4.8% forecast—also provided a supportive backdrop for Chinese stocks.
Corporate highlights
CATL shares surge
Shares in CATL soared 6% following the company’s legal action against CALB for alleged patent infringement on battery modules. This development underscores CATL’s position as a leader in the battery manufacturing sector and its focus on protecting intellectual property.
TikTok back online
TikTok resumed operations after Trump extended the deadline for ByteDance to divest its US operations. Reports suggest a planned joint venture where US owners would hold a 50% stake, signaling potential resolution to the platform’s regulatory challenges.
Market outlook
As markets digest the implications of Trump’s re-inauguration, investors remain cautiously optimistic. The combination of stable monetary policy, improving US-China diplomatic signals, and corporate developments like CATL’s performance provide a mixed but hopeful narrative for Chinese equities. Further clarity on trade and economic policies from the new US administration will likely shape near-term market direction.