FX.co ★ China Stocks Fall for Second Session

On Wednesday, the Shanghai Composite index decreased by 0.7%, closing at approximately 3,880, while the Shenzhen Component index fell by 0.6% to 13,200. This marked the second day of continued losses, primarily due to the rise in consumer inflation which dampened hopes for fresh policy interventions. China's consumer prices climbed by 0.7% in November compared to the previous year, marking the highest increase seen in nearly two years, coupled with a worsening in producer price deflation. Earlier this week, the Chinese Politburo emphasized the importance of boosting domestic demand by 2026, though they signaled a restrained approach towards enacting stimulus measures, causing investor disappointment. Investors are now focusing on the forthcoming Central Economic Work Conference where policymakers are projected to reveal growth targets and policy strategies for the upcoming year. Stocks in high-growth sectors such as technology and new energy were the biggest decliners, with significant drops in companies like Foxconn Industrial (-4.9%), Eoptolink Technology (-2.3%), Hygon Information (-3.5%), Contemporary Amperex (-1.3%), and Sungrow Power (-4.4%).