The Direxion Daily FTSE China Bear 3x Shares ETF (YANG) is experiencing a significant uptick, driven by a confluence of geopolitical and economic factors impacting the Chinese market. President-elect Donald Trump's recent threats to impose new tariffs on Chinese imports have reignited trade tensions, casting a shadow over China's economic outlook. Analysts suggest that a potential 60% tariff hike could reduce Chinese exports by 8% and GDP by 2%, exacerbating existing economic challenges such as a real estate downturn and rising unemployment. Additionally, China's retaliatory measures, including export bans on critical materials like gallium and germanium, underscore the escalating trade conflict, further unsettling investor sentiment.
Moreover, despite China's recent promises of bold economic support, global markets have shown muted reactions, indicating waning confidence in China's ability to influence broader market dynamics. The MSCI Asia Pacific regional benchmark remained largely unchanged, and Australian stocks, heavily reliant on Chinese trade, experienced declines. This tepid response highlights the growing skepticism about China's economic resilience amid ongoing geopolitical tensions and internal economic struggles.
The YANG ETF is up 12.07% in pre-market trading on Tuesday, December 10, reaching $64.33 as of 6:30 AM ET.