China stocks end at 9-month high as investors brush off tariff risks, embrace bull market

Published on 07/30/2025 at 04:35 am EDT
(Reuters) - China stocks closed at a nine-month high on Wednesday as investors looked past concerns over U.S. tariff threats and positioned themselves for a long-awaited bull market.
The Shanghai Composite Index rose as much as 0.7% to 3,636 points, its highest level since October 2024. With this, it has climbed 20% from its last significant low, an accepted definition for a bull market, three months ago.
U.S. and Chinese officials agreed to seek an extension of their 90-day tariff truce on Tuesday, following two days of what both sides described as constructive talks aimed at defusing a trade war between the world's two biggest economies that threatens global growth.
"Investors are increasingly insensitive to Sino-U.S. trade talks, and are paying more attention to domestic issues," said Wang Zhuo, partner of Shanghai Zhuozhu Investment Management.
Earlier this week, Goldman Sachs raised its target for Chinese stocks, citing "brightened prospects for a U.S.-China trade deal."
Low interest rates are nudging investors into stocks, especially high-dividend blue-chips, while China's drive to crack down on excessive competition in some industries is improving the outlook for corporate earnings, Wang said.
"Now that the index is entering bull market territory, money will undoubtedly keep flowing in. I don't see signs of froth, so the bull run has legs."
China kicked off a 1.2-trillion-yuan ($167.3 billion) hydropower project in Tibet this month, and Beijing has launched a campaign against cut-throat price wars, fanning hopes for an end to the country's deflationary spiral.
"China's stock markets are flush with capital, and we're currently in a bull market driven by this abundance," said Zeng Wenkai, chief investment officer at Shengqi Asset Management Co.
China A-share market turnover remained elevated over the past week at around 1.8 trillion yuan per day, while the outstanding margin financing balance rose to a 10-year high of nearly 2 trillion yuan.
Meanwhile, China's July Politburo meeting yielded few surprises, largely in-line with market expectations, as top leaders reiterated their commitment to supporting an economy grappling with multiple risks by addressing disorderly competition among firms.
In Hong Kong, the benchmark Hang Seng Index closed down 1.4% on Wednesday as investors took profits following three consecutive weeks of gains. The index had surged nearly 30% this year on the back of record inflows from mainland China, recovering foreign interest, and a booming market for initial public offerings (IPOs).
Thirty-nine percent of Asia-Pacific family offices planned to increase their investments in Greater China over the next 12 months, according to UBS Global Family Office Report.
By market close, China's blue-chip CSI300 Index was flat and the Shanghai Composite Index edged up 0.2%.
Auto shares dragged the Hang Seng Index, with Li Auto down more than 12%, as the pricing of its new launch and competition concerned investors.
Tech majors traded in Hong Kong also fell, down nearly 3%, largest single-day drop in more than two months.
($1 = 7.1745 Chinese yuan renminbi)
 (Reporting by Shanghai Newsroom; Editing by Kim Coghill and Harikrishnan Nair) 

Sumber : Reuters