Global Market: China stocks rise as tech shares lead gains ahead of US CPI

Chinese stocks edged higher on Wednesday as a rebound in technology shares helped offset investor caution over geopolitical tensions and the release of key U.S. inflation data, Reuters reported.

Technology stocks lead gains

At the midday break, the Shanghai Composite was up 0.3% at 3,946.51 points, while the blue-chip CSI300 index gained 0.7%.

Technology stocks led the advance. The ChiNext Composite Index rose 1.7%, while Shanghai's technology-focused STAR50 index climbed 2.1%. The CSI Semiconductor Index added 2.5%, and the CSI AI Index gained 1.8%.


The CSI 5G Communications Index rose 3.4%, with heavyweight Zhongji Innolight gaining 4.4%.

According to Reuters, UBS analysts said technology sentiment was stabilising as much of the recent bearishness appeared to have been priced into the market.

Geopolitical risks remain

Asian shares broadly edged higher on Wednesday, although investors remained cautious as geopolitical tensions intensified ahead of the U.S. inflation report.

The United States and Iran-aligned Houthi forces in Yemen reported separate attacks on shipping on Tuesday, while prospects for an end to the Iran war appeared to weaken. Tehran has indicated that the Strait of Hormuz would remain closed unless Washington meets its conditions.

Reuters reported that China Dragon Securities analysts viewed the market backdrop as improving compared with July, despite continued uncertainty from company-specific risks during the earnings season and changes in the geopolitical environment.

The analysts also pointed to greater clarity around China's policy environment, which could help stabilise equities and support a broader market rebound.

Hong Kong stocks under pressure

Hong Kong markets moved in the opposite direction. The Hang Seng Index fell 1.2% to 25,352.13, while the Hang Seng Tech Index also declined 1.2%.

Chinese American depositary receipts, or ADRs, fell 2.9% overnight, adding to the cautious tone in Hong Kong.

Investors are now awaiting U.S. consumer inflation data, which could influence expectations for the Federal Reserve's interest-rate path and provide fresh direction for global equity markets.

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