A US-China trade deal with low tariffs on Chinese goods can further promote export, which can reduce deflation pressure. On the other hand, an increase in US-China stresses may be weight on external demand, potentially intensifies deflation pressure.
Market Outlook: Trade Dialogue and Lump Economic Data Key
China’s inflation number will determine the initial tone for the week. However, on August 15, trade development and major economic figures eventually run the spirit.
The possibility of progressing on an American-China business deal is likely to raise the number of inflation, emotion. Market sensitivity to upcoming data rests on business headlines.
A trade deal and excited industrial production, labor market, and retail sales figures can take Hong Kong and mainland China-listed shares to a new 2025 high level. However, the stalled business talks can weigh at the spirit, potentially trigger a flight-safety.
The Hang Seng index increased by 1.43% in the week ended August 8, which closed at 24,859. Meanwhile, the CSI 300 of the mainland China and the Shanghai Composite Index upgraded 1.23% and 2.11%, instigated from jumping into business growth and exports.
