EBC Markets Briefing | ​A50 buoyed by trade deal headlines

China's A50 gained more than 1% on Wednesday as offered on the latest signs of progress in US-China trade talks, while more detail of what was decided and whether it would stick for long remain to be seen.

Both sides said on Tuesday they had agreed on a framework to put their trade truce back on track and remove China's export restrictions on rare earths. That allays fears of China's further slowdown.

The country's consumer prices fell for a fourth consecutive month in May, as Beijing's stimulus measures appear insufficient to boost domestic consumption. Price wars in the car industry have bolstered the trend.

Eyes will be on the l Lujiazui forum due later this month, where top financial regulators will deliver keynote speeches. Government officials said last month that major financial policies will be revealed then.

Residential sales continued to fall in May. An often overlooked pool of funds worth 10.9 trillion yuan could be utilised to salvage its housing sector, offering an alternative to bank mortgages.

The World Bank slashed its global growth forecast for 2025 by four-tenths of a percentage point to 2.3%, saying higher tariffs and heightened uncertainty posed a "significant headwind" for nearly all economies.

The A50 index stays comfortably above 50 SMA and the volatility has been muted this month. We expect it to retest the support around 13,300 if the consolidation goes on.

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