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Significance
The Nasdaq Golden Dragon China Index -- a gauge of US-listed Chinese shares -- lost 22% in July, compared with the Nasdaq 100 Index gaining 3.5%. Beijing’s crackdown is unnerving investors at a time Big Tech also faces potential threats from tighter global financial conditions and tougher regulation in Europe and the United States.
Impacts
Uncertainty is high regarding the withdrawal of stimulus because COVID-19 variants remain a high risk, but cost pressures are also rising.
Overseas purchases of Chinese stocks via Hong Kong, which gained 50% year-on-year in January-June despite regulatory fears, will rise more.
The ten-year US Treasury yield is near a six-month low despite the inflation fears, easing fears about a wider deterioration in sentiment.
Keywords:
International,
INT,
China,
United States,
economy,
equities,
regulation,
technology,
Capital markets
© Oxford Analytica 2021. All rights reserved. This content contains general information about geopolitical, macroeconomic and social developments or (where stated) other matters. It does not contain advice or recommendations that may be relied on. Where links to external websites are provided, this does not indicate that Oxford Analytica or Emerald agree with, endorse or have checked for accuracy the contents of said sites.
2021
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