The Chinese mainland markets experienced a cautious session on Monday, influenced by diplomatic tensions with Japan and mixed reactions to U.S. reassurances about a potential rare earth deal, said a market analyst.
Chinese stocks closed lower on Monday, with the benchmark Shanghai Composite Index down 0.46 percent to 3,972.03 points.
The Shenzhen Component Index closed 0.11 percent lower at 13,202 points.
Timothy Pope, a market analyst for China Global Television Network (CGTN), highlighted the trend behind the numbers in his recap of China's stock market performance.
"The Chinese mainland markets had a bit of an off session today with the Shanghai Composite Index sinking about half of one percent. There was an overall sense of caution. We saw some diplomatic tensions flaring between China and Japan the weekend over a speech the new Japanese Prime Minister made in parliament. And investors took the opportunity to lock in some profits after that. So shares with exposure to Japan were the biggest losers, but even recent winners like the rare earth sector were pretty flat today. And that was even though the U.S. Treasury Secretary Scott Bessent saying that there will hopeful be a China-U.S. deal on the rare earths by the end of the month. Perhaps using the word "hopefully" undermined his own attempt at optimism," he said.
"In Shenzhen we did see losses offset by gains among AI and EV firms. Investors still see solid growth potential there. Today was another one of those days which has kept the Shanghai and Shenzhen markets range bound this month, still unable to find really firm footing above 4000 points. But what we have seen is continued strong interest from foreign buyers who are looking for exposure to Chinese equities, especially in the emerging sectors where Chinese companies either lead the world, or rival big US or European names like in EVs and AI," said Pope.
"According to recent data from the Institute of International Finance, from January to October, 50.6 billion U.S. dollars of offshore money flowed into Chinese equities. That's not quite a record -- 2021 is still the best full year on record with more than 73 billion dollars flooding in, but when you consider that that was followed by three very lean years -- last year's total was just 11.4 billion -- the numbers so far this year look very strong, and China's stocks are still trading at a discount compared to the rest of the world," said the analyst.
China markets dip as investors lock in profits amid cautious Monday trading: analyst
Chinese Foreign Minister Wang Yi said on Tuesday that mediation efforts of the Pakistani side regarding the Middle East tensions are in the common interests of all parties.
Wang, also a member of the Political Bureau of the Communist Party of China Central Committee, made the remarks in his talks with Pakistani Deputy Prime Minister and Foreign Minister Mohammad Ishaq Dar in Beijing.
During their talks, the two sides exchanged views on current international issues and regional conflicts.
Wang welcomed the visit of the Pakistani side to Beijing for discussion on easing tensions in the Middle East, just after its holding of a quadrilateral foreign ministers' meeting in Islamabad.
He said China supports and looks forward to Pakistan playing a unique and important role in easing the situation and resuming peace talks. This process is no easy task, and Pakistan's mediation efforts are in line with the common interests of all parties, Wang added.
He noted China is willing to make joint efforts with Pakistan to end the hostilities as soon as possible, create opportunities for peace and open the window for peace talks.
On bilateral ties, Wang said this year marks the 75th anniversary of the establishment of diplomatic relations between China and Pakistan, calling on both sides to implement the important consensus reached by the leaders of the two countries and constantly advance the building of a China-Pakistan community with a shared future.
For his part, Dar said the Pakistan-China friendship is precious and deeply rooted in people's hearts, adding that Pakistan is willing to work with China to promote the continuous development of the all-weather strategic cooperative partnership between the two countries.
Dar thanked China for supporting Pakistan's mediation of the situation in Iran, adding that the current conflict has disrupted international energy supplies and caused heavy damage to developing countries.
Noting that solutions can only be found through negotiation, Dar said Pakistan is willing to strengthen communication and coordination with China to push all parties to start peace talks as soon as possible and restore regional peace.
The two sides also put forward a five-point initiative for restoring peace and stability in the Gulf and the Middle East region:
I. Immediate cessation of hostilities: China and Pakistan call for immediate cessation of hostilities and utmost efforts to prevent the conflict from spreading. Humanitarian assistance must be allowed to all war-affected areas.
II. Start of peace talks as soon as possible. Sovereignty, territorial integrity, national independence and security of Iran and the Gulf states should be safeguarded. Dialogue and diplomacy is the only viable option to resolve conflicts. China and Pakistan support the relevant parties in initiating talks, with all parties committing to peaceful resolution of disputes, and refraining from the use or the threat of use of force during peace talks.
III. Security of nonmilitary targets. The principle of protecting civilians in military conflict should be observed. China and Pakistan call on parties to the conflict to immediately stop attacks on civilians and nonmilitary targets, and fully adhere to International Humanitarian Law, and stop attacking important infrastructure, including energy, desalination and power facilities, and peaceful nuclear infrastructure, such as nuclear power plants.
IV. Security of shipping lanes. The Strait of Hormuz, together with its adjacent waters, is an important global shipping route for goods and energy. China and Pakistan call on the parties to protect the security of ships and crew members stranded in the Strait of Hormuz, allow the early and safe passage of civilian and commercial ships, and restore normal passage through the Strait as soon as possible.
V. Primacy of the United Nations Charter. China and Pakistan call for efforts to practice true multilateralism, to jointly strengthen the primacy of the United Nations, and to support the conclusion of an agreement for establishing a comprehensive peace framework and realizing lasting peace based on the purposes and principles of the UN Charter and international law.
Pakistan's mediation efforts in common interests of all parties: Chinese FM
Pakistan's mediation efforts in common interests of all parties: Chinese FM
