Chinese Bonds Hit Nine-Month Low Despite Global Sell-Off Wave

The decline in Chinese bonds could negatively impact global risk appetite, potentially accelerating outflows from emerging markets. Similar selling pressure may emerge in fragile economies like Turkey. In the short term, as investors seek safe havens, demand for the dollar is expected to rise, while Turkish lira-denominated assets may depreciate. This could also lead to a sell-off trend on Borsa Istanbul.

The CSI300 index closed down 2.48% yesterday, trading just below its 20-day moving average (4,842). The RSI has fallen to 45.6, dipping below the neutral zone and indicating weakening short-term momentum. The MACD line remains below the signal line and in negative territory, confirming a bearish trend. News headlines note that Chinese bonds are at nine-month lows despite a global sell-off, which could reduce risk appetite and pressure equities. In the near term, the index is likely to test the 4,800 level, but since it has not entered oversold territory, a sharp acceleration in the decline is not expected.

The HSI fell 1.75% in 24 hours to 25,655, closing below the 20-day moving average (25,726). Although the RSI at 38.5 approaches oversold territory, momentum remains weak; the MACD line is below the signal line and in negative territory. Chinese bonds hitting a nine-month low indicate reduced risk appetite and suggest selling pressure may persist. In the short term, the 25,500 support level could be tested, but oversold conditions may trigger bargain buying.