Chinese stocks, including Alibaba (BABA), JD.com (JD), Baidu (BIDU), and Pinduoduo Holdings (PDD), trended lower at the time of writing on Monday as investors remain concerned about China’s economic recovery. China’s latest consumer price index indicated that inflation remained flat year-over-year in June and was at the lowest level since February 2021, compared with economists’ forecasts and May’s rise in inflation of 0.2%. Core inflation, excluding the volatile prices of food and energy, increased by 0.4% year-on-year in June, the least since March 2021, after a 0.6% rise in May.
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Meanwhile, China’s producer price index (PPI) fell at the fastest pace in more than seven years in June by 5.4% year-over-year as compared to a 4.6% decline in May.
The macro concerns arise even as there are signs of China’s tech crackdown easing as Alibaba’s Ant Group has been fined around $1.1 billion by Chinese regulatory authorities. The payment of this fine could clear the way for the Ant Group to move toward securing a financial holding company license and possibly aim for an IPO again.
The macro concerns have also weighed on the Franklin FTSE China ETF (FLCH), which is down by more than 7% year-to-date.
