Most Asian stock market indices were trading lower on Tuesday (7 Feb), with the Shanghai Composite down 0.47% at 3,142.02 as of 5.31am GMT. This followed expectations that China will report a further decline in its foreign exchange reserves.
The world's second biggest economy is expected to report its foreign-exchange reserves data for January on Tuesday. On Monday, economists polled by Reuters suggested that China will report a $10.5bn (£8.42bn) fall in its forex reserves in January. While this would be about a quarter of the drop seen in December, it would mark the seventh straight month of decline to about $3tn. This spurred investor fears over China's economy.
Meanwhile, a few economists were optimistic. They said China may surprise the markets by reporting an uptick in reserves after a long period of declines. Nevertheless, it was said that China's forex reserves lingering at around the $3tn mark would lead to concerns over the speed at which the Asian country has depleted its resources to defend the renminbi.
The bearish trend also follows a negative close overnight on the Wall Street. Investors were said to be keenly awaiting the economic policies of US President Donald Trump.
"The longer Congress and the Trump administration dither on fiscal stimulus, the less likely in everyone's estimation that it will come to pass," Aaron Kohli, an interest rate strategist at BMO Capital Markets, was quoted as saying by Reuters.
Indices in the region were trading as follows at 5.49am GMT:
|Hong Kong||Hang Seng Index||23,327.61||Down||0.09%|
On 6 Feb, the FTSE 100 Index closed 0.22% lower at 7,172.15, while the S&P 500 index closed 0.21% lower at 2,292.56.
Among commodities, oil prices recovered as supply concerns eased. As of 12.39am EST, WTI Crude Oil was up 0.25% at $53.14 (£42.62) a barrel, while Brent Crude was trading 0.29% higher at $55.88 per barrel.