FX.co ★ China Stock Market Tipped To Extend Tuesday's Losses

On Tuesday, the China stock market concluded a modest two-day winning streak, during which it had only risen by 5 points or 0.2 percent. The Shanghai Composite Index now rests just below the 2,880-point mark, and forecasts suggest potential selling pressure on Wednesday.

Global predictions for Asian markets are mixed to lower, with significant losses anticipated in the technology sector. European and U.S. markets displayed mixed performances, hinting at a challenging opening for Asian bourses.

The Shanghai Composite Index fell by 12.55 points, or 0.43 percent, closing at 2,879.30 after fluctuating between 2,865.15 and 2,885.22. The Shenzhen Composite Index also dipped, losing 2.68 points, or 0.17 percent, to settle at 1,559.51.

Key market movers included:

- Industrial and Commercial Bank of China: +0.17%

- Bank of China: +0.63%

- China Construction Bank: +0.13%

- China Merchants Bank: -0.09%

- China Life Insurance: -0.93%

- Jiangxi Copper: -1.57%

- Aluminum Corp of China (Chalco): -3.36%

- Yankuang Energy: -1.29%

- PetroChina: -3.94%

- China Petroleum and Chemical (Sinopec): -3.43%

- Huaneng Power: -1.68%

- China Shenhua Energy: -2.55%

- Gemdale: +2.05%

- Poly Developments: +1.83%

- China Vanke: +0.90%

- Bank of Communications: unchanged

Wall Street provided a largely negative lead after major averages opened slightly higher, only to lose momentum and finish mixed. The Dow climbed 203.40 points, or 0.50 percent, to close at 40,743.33. Conversely, the NASDAQ dropped 222.79 points, or 1.28 percent, ending at 17,147.42, while the S&P 500 declined 27.10 points, or 0.50 percent, to settle at 5,436.44.

This mixed performance came as traders anticipated the Federal Reserve's monetary policy announcement later in the day. While the Fed is expected to maintain current interest rates, the accompanying statement could significantly influence the outlook for the central bank’s September decision.

The steep decline in the NASDAQ was driven by pressure on tech stocks, notably Nvidia (NVDA), Microsoft (MSFT), and Advanced Micro Devices (AMD). Semiconductor stocks were particularly hard-hit, causing a 3.9 percent plummet in the Philadelphia Semiconductor Index, marking its lowest close in over two months.

Additionally, oil prices dropped on Tuesday amid concerns about demand and in anticipation of the Federal Reserve’s announcement and weekly inventory data. West Texas Intermediate crude oil futures for September fell by $1.08, or 1.42 percent, to $74.73 per barrel.

Closer to home, China is set to release July results for its manufacturing, non-manufacturing, and composite Purchasing Managers' Indices (PMIs) from the National Bureau of Statistics. In June, these scores were 49.5, 50.5, and 50.5, respectively.