Latest news with #ShanghaiExchange
See - Sada Elbalad
30-05-2025
- Business
- See - Sada Elbalad
Shanghai Futures Exchange Opens Doors to Foreign Investors in Move to Boost China's Influence in Global Metals Markets
Waleed Farouk The Shanghai Futures Exchange (SHFE) announced on Tuesday 34 new regulatory proposals aimed at opening China's futures market to foreign investors and brokers, as part of efforts to support the internationalization of the Chinese currency (RMB) and enhance China's influence in global commodity pricing. The proposals cover multiple areas, including gold and silver options trading, hedging, and precious metals futures trading. The exchange emphasized that the goal is "full opening to foreign participants." Tiger Shi, CEO of BANDS Financial, told Reuters that this announcement represents "a fundamental change in the Shanghai Exchange's constitution," noting that direct foreign access to the exchange's products is "now on the fast track." Key proposed changes: Allowing foreign brokers and investors to trade directly without the need for local intermediaries. Accepting margin in foreign currencies such as the US dollar. A public comment period on the proposals will be open until June 4. A broader strategy to internationalize the Chinese market This move aligns with an earlier announcement on April 21 by the People's Bank of China (PBoC) and three other government agencies, which included investments to promote the internationalization of the Shanghai Gold Exchange (SGE), including the establishment of international delivery warehouses, in preparation for competing with the London Metal Exchange (LME) for its role in global gold pricing. A report issued at the time by Jinshi Data indicated that the plan aims to "enhance Shanghai's capacity as an international financial center for the allocation of global resources." It includes developing a platform for trading cross-border financial assets, supporting cooperation with foreign exchanges in product pricing, and expanding the use of renminbi reference prices in global markets. Reshaping the Global Pricing Map Although China is the world's largest consumer of precious metals, the pricing of most of its transactions remains tied to international prices, such as those issued by the London Metal Exchange. However, Beijing seeks to change this equation by making Shanghai futures a global benchmark, potentially dismantling Western dominance of metals markets for the first time in more than 140 years. Reuters previously reported that China's success in attracting foreign traders to the Shanghai Exchange will give its contracts a global benchmark and reduce reliance on Western price signals. In statements to state media, Wang Fenghai, general manager of the Shanghai Exchange, said that internationalizing the market is a prerequisite for strengthening China's influence in metals pricing. He added that the exchange is working to develop cross-border delivery capabilities by establishing warehouses outside China to store the metals associated with its futures contracts. read more CBE: Deposits in Local Currency Hit EGP 5.25 Trillion Morocco Plans to Spend $1 Billion to Mitigate Drought Effect Gov't Approves Final Version of State Ownership Policy Document Egypt's Economy Expected to Grow 5% by the end of 2022/23- Minister Qatar Agrees to Supply Germany with LNG for 15 Years Business Oil Prices Descend amid Anticipation of Additional US Strategic Petroleum Reserves Business Suez Canal Records $704 Million, Historically Highest Monthly Revenue Business Egypt's Stock Exchange Earns EGP 4.9 Billion on Tuesday Business Wheat delivery season commences on April 15 News Ayat Khaddoura's Final Video Captures Bombardment of Beit Lahia News Australia Fines Telegram $600,000 Over Terrorism, Child Abuse Content Arts & Culture Nicole Kidman and Keith Urban's $4.7M LA Home Burglarized Sports Former Al Zamalek Player Ibrahim Shika Passes away after Long Battle with Cancer Sports Neymar Announced for Brazil's Preliminary List for 2026 FIFA World Cup Qualifiers News Prime Minister Moustafa Madbouly Inaugurates Two Indian Companies Arts & Culture New Archaeological Discovery from 26th Dynasty Uncovered in Karnak Temple Business Fear & Greed Index Plummets to Lowest Level Ever Recorded amid Global Trade War Arts & Culture Zahi Hawass: Claims of Columns Beneath the Pyramid of Khafre Are Lies News Flights suspended at Port Sudan Airport after Drone Attacks
Business Times
06-05-2025
- Automotive
- Business Times
Perception vs reality in markets
THE gap between perception and reality is called opportunity. It has been many years since the gap has been quite as large as it is now in US markets. How we react to this gap determines both trading and long-term investment outcomes. Many economic commentators in the US appear to believe that the US is winning the President Trump-initiated trade war with not just China, but also the world. Trump tells the media that he has concluded more than 200 deals as a result of his tariff mayhem. All markets rebounded rapidly after the initial collapse immediately following his 'Liberation Day' announcement on Apr 2. In US markets, the rebound followed Trump's pullback on tariffs. Whether that is evidence of winning remains an open question. However, the narrative favoured by Trump and his trade advisors like Peter Navarro is that America is winning the tariff war, and that despite a small pullback in GDP, the future for the economy is very good. But there is a small and growing group of analysts and fund managers who have a more bearish outlook. They claim to be realists. They point to the fall in GDP numbers and a US Purchasing Managers Index figure below the critical 50 level. They point to China's refusal to submit to tariff pressure and its selective use of countervailing tariffs to bring the US to the negotiating table. They also note that the US makes up less than 14 per cent of China's total export market, and point to the integration of US manufacturing with international supply chains, most of which rely on Chinese components and participation. The fact remains that China is the largest market for cars, and the major source of profits for all US carmakers. Closing this market destroys the profitability of US carmakers, and there is no substitute market in the US. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up To succeed, traders must trade what they see on the price chart, rather than what they might believe about the market condition. Investors have a more unenviable task, because they make investment decisions based on their long-term expectation of how the market would behave. It is easier when perception and reality coincide, and more difficult when they diverge. In all situations, the chart of index activity provides a closer approximation to the reality of the economy. There are two places to look at in this battle between economies. The first is the broad S&P 500 index. It is not perfect because it comprises only the top 500 stocks. This means the S&P is based on survivor bias, because the index components include only winners, so it gives the appearance of always rising. The second is the Shanghai Index, which comprises all stocks trading on the Shanghai Exchange. The S&P 500 Index is dominated by the rounding-top pattern. The rapid pullback in April exceeded the chart pattern projection targets for a 20 per cent fall. This is very bearish. The rebound from support near 5,200 does not mean the influence of the pattern on the market has ended. The rebound rally is not yet a trend change. The arc of the rounding top is projected to the right. Technically, the Index needs to move above this projected value, now around 6,050, before we can say a new uptrend is in place. Until the index breaks above the pattern line, the best that can be said is that the market is in a rally. This means the market may retreat and again test the 5,200 support level. The Shanghai Index has traded in a broad sideways trading band between 3,150 and 3,400 since October 2024. The three breakouts above 3,400 have been weak. The fall below 3,150 was also weak in the sense that it was followed by a rapid recovery. The 3,300 level has acted both as a support and resistance feature in this broader trading band. The rally rebound has stalled and is consolidating around this level. From the US perspective, it indicates an unexpected level of resilience. The consolidation carries with it the potential to break on the upside and move towards longer-term resistance near 3,400. A successful break above this level has the next resistance target near the previous high at 3,670. Any retreat from current levels has historical support near 3,150, or a fall of around 4 per cent. A retreat to these levels would not signal a collapse of the Chinese economy because it would be consistent with the normal ranging behaviour of the index over the past seven months. The opportunity presented by the gap between perception and reality is that traders have the choice of going long while they are prepared to exit the trade quickly as the market pulls back. Investors may use dips as a buying opportunity and hedge these positions at rally peaks. The charts suggest that the reality is that the US market has a bear lurking in the background because the China market shows unexpected resilience. The writer is a financial technical analysis specialist, equity and derivatives trader and author
