China’s economy is floundering – and that could be bad news for Wall Street.
From a slowdown in industrial production to plunging import and export levels, investors are assessing warning signs that Beijing is struggling to restart growth after it ended its hard-line zero-COVID restrictions late last year.
The People’s Bank of China has responded by slashing key interest rates, in a hope that lower borrowing costs will revive slumping spending levels.
But even those measures have failed to soothe investors, with the benchmark CSI 300 stock-market index slipping 0.2% last week after the bank lowered mortgage-linked loan repayment rates.
And stagnating growth in China could soon become a pain point for US stocks – which have started the year on a breakneck tear – as well.
The AI craze has fueled a massive rally for mega-cap tech stocks like Nvidia and Microsoft – with their colossal share-price gains lifting the benchmark S&P 500 14% and the Nasdaq Composite 31% year-to-date.
