26 Mar

CN50 index sensitive to flood of earnings this week

March 26, 2025

By ForexTime 

  • 34% of CN50 members reporting earnings this week.
  • Earnings by BYD and China Merchants Bank helped support CN50 above 21-day SMA.
  • 24% of CN50 members left to report earnings by the weekend.
  • Banking stocks carry the most weightage (23.8%) on the CN50 index.
  • CN50 bulls eager for more signs of economic resilience and support.

 

FXTM’s CN50 index is bracing for even more earnings announcements this week.

NOTE: FXTM’s CN50 index tracks the underlying FTSE China A50 index, which measures the overall performance of the 50 biggest A Share Chinese companies.

For the entire week, about a third (34%) of the 50 members on this stock index are set to unveil their respective financial results.

Earlier this week, BYD and China Merchants Bank – two of the 5-biggest CN50 members – have already made their respective announcements, which helped keep CN50 supported above its 21-day simple moving average (SMA).

However, initial gains were thwarted around the 13,470 region – a notable resistance back in February 2025 as well, before returning to test support around the 21-day SMA once more.

Also, the 13,470 region served as the mid-range for the CN50’s sideways pattern in most of Q4 2024.

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CN50 to react to earnings

 

But there’s more!

Some 24% of the CN50’s members are due to release their earnings in the days ahead.

  • This includes many major banks, such as Industrial & Commercial Bank of China, Industrial Bank, and the Agricultural Bank of China.
  • Banking stocks have the most members (12) represented on the CN50 index of any other industry group, collectively account for nearly 24% of this index.

In short, these earnings could hold great influence over the CN50’s near-term performance.

 

And the CN50 could use all the help it can get.

The CN50 has lagged behind FXTM’s other Chinese stock indexes, namely the CHINAH and HK50, in terms of their respective performances so far in 2025:

  • CN50: down 0.8% year-to-date
  • HK50: up 17.1% year-to-date
  • CHINAH: up 18.8% year-to-date

Even though it’s pretty much flat on a year-to-date basis, the CN50 is still holding up well relative to its US counterparts:

  • US500: down 1.8% year-to-date
  • NAS100: down 3.4% year-to-date
  • US400: down 3.6% year-to-date
  • RUS2000: down 6% year-to-date

 

Earnings boost enough for CN50 bulls?

Granted, while an earnings boost will be roundly welcomed by CN50 bulls (those hoping prices will go higher), it’s unlikely to rapidly narrow the year-to-date gap with the likes of CHINAH and HK50.

After all, the latter two indices have soared on the AI-mania that’s now swaying Chinese markets.

Ultimately, given how economically-sensitive CN50’s constituents are, this index may need further evidence of incoming support to shore up China’s recovery.

Hence, beyond the corporate earnings announcements, traders and investors are also set to draw clues about the overall health of China’s economy via these upcoming major data releases:

  • Thursday, March 27th: February industrial profits
  • Monday, March 31st: March purchasing managers’ indexes (PMIs)

Should concerns surrounding global economic growth become less pronounced, that could carve out more upside for the CN50 index, and vice versa.

 

Potential Scenarios:

  • BULLISH: Better-than-expected earnings, along with easing concerns over the global economic outlook, should raise the odds of CN50 reclaiming the 13,800 handle.

     

  • BEARISH: Disappointing CN50 member earnings this week, along with rising concerns about the global economic outlook, could drag this stock index below its 21-day SMA to potentially test its 50-day SMA as an immediate downside target. 

    The psychologically-important 13k level then lies further south to potentially shore up support.

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com


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