China stock market almost completely reverses previous loss

It fell only by 0.7% w/w.

On January 23, the Shanghai Composite Index almost completely reversed its previous loss.

According to a research note from CCB International, further, on a weekly basis it fell only fell 0.7%.

The report noted that China’s flash PMI was better than expected, at 49.8 in January, up slightly from 49.6 in December.

During the last few years in China, manufacturing activity has tended to fizzle in the approach to Chinese New Year.

Here's more from CCB International:

Parsing December’s macro data release, we note a pickup in transportation investment implying accelerated approvals for infrastructure projects have already helped to push domestic demand, and will help avert a sharp slowdown in economic growth in 1Q15 when seasonality tends to turn unfavorable.

However, looming disinflation and high financing costs remain a concern.

We maintain our forecast of front-loaded monetary easing in 1Q15, including both interest rate and RRR cuts.