The Chinese equities stayed supported on global trade talk hopes as the US President Donald Trump tweeted that trade talks are going very well. Supportive overnight cues and continued bargain buying also ensured that the benchmark Shanghai Composite Index stays well supported after falling to a four year low in the last week of December 2018. The index closed at 2544, up 0.71% on the day after hitting around its three week high mark. Trade talks between the US and China in Beijing were extended an extra day to Wednesday, signalling the world’s two largest economies could be closer to an agreement.
However, the broad undertone remains cautious for the world markets as the World Bank cut its forecast for the global economy in a semiannual update to its outlook on Tuesday. The Washington-based bank forecast 2.9% global growth this year, down from 3%. For emerging markets, it cut projections by 0.5 points to 4.2%. Growth in China is expected to slow to 6.2% this year from 6.5% last year as domestic and external rebalancing continues.