The Direxion Daily FTSE China Bear 3x Shares (YANG) is experiencing upward momentum as Chinese equities face pressure following a surprise move by the People's Bank of China (PBOC). On January 10, 2025, the PBOC unexpectedly halted its government bond buying program, a decision aimed at cooling down excess demand. This move has led to higher yields in China, contributing to a decline in Chinese equities. The ripple effect of this decision is also felt in Hong Kong stocks, which are showing weakness. The broader Asian markets, including Japanese and Australian indexes, are also experiencing declines, further supporting the bearish sentiment towards Chinese equities.
In addition to the PBOC's actions, global market conditions are adding to the pressure on Chinese stocks. The U.S. jobs report, which came in hotter than expected, has led to a sell-off in Wall Street's major averages, with the S&P 500, Nasdaq Composite, and Dow all experiencing declines. This has contributed to a risk-off sentiment in global markets, affecting investor confidence in Chinese equities. The strengthening of the U.S. dollar against most major currencies is another factor weighing on the market, as it impacts the competitiveness of Chinese exports.
The YANG ETF, which inversely tracks the performance of the FTSE China 50 Index, rose to $82.76, marking a 7.86% increase from the previous close.