China’s financial markets weakened slightly in the middle of the trading week. The decline of the Shanghai Stock Exchange was caused by conflicting information from central bankers and the media addressing the direction of the country’s economic policy.
The main index of the Shanghai Stock Exchange CSI300 weakened by 0.4 percent on Wednesday and fell below five thousand points. The decline is due to conflicting information about the future direction of economic policy. While the Chinese media reported that China would implement measures that would support the country’s long-term prosperity, the Chinese central bank’s information was somewhat contradictory.
The People’s Bank of China has reaffirmed its commitment to a strong monetary policy, which means that the supply of liquidity to the banking sector will remain virtually unchanged. That is, the Chinese central bank does not intend to take any emergency measures, which should now lead to accelerated economic growth.
The biggest drop on Wednesday was recorded by energy and engineering titles. On the contrary, shares of the infrastructure or mining sector grew. This is mainly due to the growing demand for steel production.