"Sharp Sales in Chinese Stock Markets and Rising Bond Transactions"

Signs of Recovery Following Deep Losses in Chinese Stock Markets

In recent days, there has been a notable sell-off in the Chinese stock markets. Despite U.S. President Donald Trump's indication of openness to negotiations, investors are increasingly concerned about escalating trade tensions. As losses deepen in Asian markets, the Hong Kong-based Hang Seng China Enterprises Index experienced a 3.1% decline during the morning session, while tech giants such as Alibaba Group Holding Ltd. and Tencent Holdings Ltd. continue to face some of the most severe drops in stock market history.

Investment Reaction Buys and Index Changes

Particularly, the CSI 300 Index partially mitigated its losses after a 2.7% drop with reaction buying, and is currently trading 1.76% below Friday's close. Additionally, the Shanghai Composite Index fell by 1.3%, and the Hong Kong Hang Seng Index declined by 3.49%, further increasing investors' concerns.

Central Bank's Effort to Stabilize Yuan

The People's Bank of China raised the daily reference rate of the yuan to its strongest level since November in an attempt to maintain stability. While this move aims to reduce the impact of the severe sell-off in the markets, it has not fully restored investor confidence. This decline follows a rapid surge experienced since the beginning of the year.

Trade Tensions and Market Response

Trump’s comments over the past weekend, threatening to impose an additional 100% tariff on Chinese products in response to Beijing's export restrictions on critical minerals, have once again highlighted the fragility of trade peace. Despite the Nasdaq Golden Dragon China Index dropping by 6.1% last Friday, some investors tend to view the signals of willingness to negotiate from the White House as a buying opportunity.

Pepperstone Group analyst Dilin Wu commented, "Markets should be prepared for short-term fluctuations caused by tariff news. However, China's diverse export structure and rapid policy responses may help limit the overall impact on the economy." In this environment, a notable upward trend has been observed in semiconductor producers and rare earth element stocks.