This article was originally published on ETFTrends.com.
Persisting trade tensions with the U.S. are starting to affect China's job market, according to China’s top economic planning body. As a result of the trade war impasse, companies could be scaling back on hiring new college graduates.
“Due to (the) impact from the continued increase of China-U.S. economic trade frictions and other uncertainties, recruitment demand for university graduates is tightening in internet, finance and other industries,” according to a statement to CNBC from a spokesperson for the National Development and Reform Commission (NDRC).
“Some companies have postponed their campus recruiting (efforts), among which some companies may have reduced or suspended recruitment,” said the Chinese-language statement, according to CNBC’s translation.
Bearish exchange-traded funds (ETFs) like the Daily FTSE China Bear 3X Shares (YANG) could see strength if a languishing job market has broader effects on the country's economy. Meanwhile, May saw volatility rain down on U.S. equities as U.S. President Donald Trump threatened to impose increased tariffs on Chinese goods on Friday with the hope that it would force China's hand in relenting to a trade deal.
Of course, YANG traders are rejoicing the latest events on the U.S.-China trade deal impasse. The fund seeks daily investment results equal to 300 percent of the inverse (or opposite) of the daily performance of the FTSE China 50 Index. The index consists of the 50 largest and most liquid public Chinese companies currently trading on the Hong Kong Stock Exchange ("SEHK").
Further market in China could occur as the job market faces further pressures.
“That’s why we are asking local governments to work out and to find out the detailed information at factories, so the way to cope with such a situation is to reduce production, but not lay off staff,” said Liang Ming, director of the Institute of International Trade under the Ministry of Commerce.. “There may be slighter pay or less workload, but we need ensure that no workers are laid off.”
Whether a trade deal will happen by year's end or not will certainly put China-focused ETFs in the spotlight. Any sliver of positive news could send the bulls back into the forefront.
As such, other leveraged ETFs to play include the Direxion Daily FTSE China Bull 3X ETF (YINN) , Direxion Dly CSI 300 China A Share Br 1X ETF (CHAD) , Direxion Daily CSI 300 CHN A Share Bl 2X ETF (CHAU) , and Direxion Daily CSI CHN Internet Bull 2X Shares (CWEB) .
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