China’s efforts to support stocks in Shanghai, Shenzhen and Hong Kong has triggered a US$689 billion gain in market valuation last week following 2023’s brutal sell-off. This recovery may not be a long-lasting one as policymakers are still faced with the challenging task of attracting money managers back to Chinese equities in a meaningful way.
A Goldman Sachs poll of its clients this month showed 59 per cent of investors viewed China’s markets as investible, which means a still-significant 41 per cent are hesitant about buying stocks. Geopolitical risks, domestic politics, and deflation were the top concerns.
“The ‘emergency response’ by China last week helped restore investor confidence,” said Qi Wang, chief investment officer of UOB Kay Hian’s wealth management division in Hong Kong. “How long the optimism will continue depends on whether the policy momentum can continue. China must show willingness to act on any…
