China's Elusive Stimulus: Markets on Edge

China's markets remain volatile following the absence of detailed fiscal stimulus announcements, affecting global stocks, particularly in Europe. The CSI300 index initially surged before retreating, while Hong Kong's Hang Seng suffered a steep decline. Oil prices and global economic concerns also weighed on investor sentiment.

A lack of detailed information regarding China's anticipated fiscal stimulus led to a decline in Chinese shares on Tuesday. This pullback affected Hong Kong stocks and global markets, including European shares and oil prices. Broader market pressures included tensions in the Middle East and Federal Reserve rate movements following strong U.S. jobs data.

The CSI300 index in China saw an early 10% increase, reaching its highest since July 2022, as markets reopened post the National Day holiday. However, it ended the day just 5.9% higher after inadequate fiscal stimulus details were delivered by Zheng Shanjie, China's top economic planner.

This disappointment was mirrored in the Hang Seng Index, which fell 9.4%, reversing gains from the Chinese holiday period. Rong Ren Goh from Eastspring Investments noted the market's impatience for guidance on fiscal stimulus. European shares dropped as well, influenced by losses in sectors sensitive to Chinese economic shifts, exacerbating existing market concerns.

(With inputs from agencies.)