International investors are ramping up their investments in the Chinese mainland's equity market, driven by optimism over new economic policies aimed at stimulating growth and recovery.
Global hedge funds are pouring money into Chinese stocks at unprecedented levels. According to Bloomberg, U.S.-based Mount Lucas Management, Singapore's GAO Capital, and South Korea's Timefolio Asset Management are among those taking bullish positions on the Chinese markets.
While the Chinese mainland's stock markets were closed for the recent seven-day National Day holiday, Chinese-related exchange-traded funds in Tokyo reached record highs last Friday. This surge reflects growing confidence among Japanese investors in the Chinese mainland's stimulus efforts, as reported by Nikkei Asia.
Following the September meeting of the Political Bureau of the Communist Party of China Central Committee, which introduced additional economic measures, Goldman Sachs issued a series of bullish reports on the Chinese stock market. The investment bank upgraded its recommendation on Chinese stocks to \"overweight.\"
\"A massive move in a short amount of time for the world's second-largest economy, and that's going to have ripple effects lifting all emerging markets,\" said Will McGough, Director of Investments at Prime Capital Financial, in an interview with Forbes, referring to the Chinese mainland's stimulus measures.
The measures have already boosted Chinese indexes and currency, European luxury stocks, global miners, and commodity prices, noted the Wall Street Journal. However, it added that the Chinese mainland's next moves in the coming months could be crucial in determining the long-term direction of its economy.
At a press conference on Tuesday, Zheng Shanjie, head of the National Development and Reform Commission, outlined a series of actions to further bolster the economy.
A key announcement was that investment projects worth 200 billion yuan ($14.14 billion) slated for next year will be advanced to this year to support local governments in accelerating preliminary work and construction.
Think tank China Finance 40 Forum commented that the government's plan to front-load the 200 billion yuan could drive a significant uptick in economic growth in the fourth quarter, helping the Chinese mainland achieve its annual target of five percent GDP growth.
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Foreign investors increase bets on China as sentiments turn bullish
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