Investment in Small Chinese Stocks Expected to Bloom
As some analysts expect he momentum to come off The Trump Rally in the late Spring, it does not seem unreasonable that the market in Chinese stock will bloom and flower into the Summer.
Y 2016 was not great for Chinese stocks.
At the end of Y 2016 the Shanghai composite index was down more than 12%, the smaller-cap Shenzhen exchange by more than 14%. As the USD rose, the devaluation of RMB Yuan and the corresponding flight of capital from China has intensified.
Economic growth slowed, and Beijing has been more focused on regulatory reform and anti-corruption than on stimulative policies.
But, this has turned in Y 2017
For China, few expect a hard landing this year, and the administration of President Xi Jinping, for all its reformist agenda, has shown it will take extraordinary steps to pump up growth.
In the real economy, there are some signs of strengthening.
I expect lots more stimulus in Y 2017.
Politically, a leadership change is coming up late next year, and much will depend on the legacy factor for Xi, who, by the way, gets to name his successor. Xi will want to go out as a hard-line reformer, or as the man who returned China to the path to prosperity.
That said, smart asset allocation and portfolio diversification into some select Chinese stocks looks a prudent strategy.
For the Complete List of Chinese ADRs trading on the US Exchanges as of Mar 2017 click here.
For the Complete List of Chinese ADRs trading on the US OTC Markets as of March 2017 click here.
For the Complete List of Chinese ETFs click here
- The Largest and Most Powerful Public Chinese Companies 2015 (TFS)
- The Complete list of China GDRs (TFS)
- Articles on China (TFS)
- Shanghai Stock Exchange
- Hongkong Stock Exchange
- Shenzen Stock Exchange
Daily, in our column titled Key Stock Indexes, Crude, Gold & Silver Markets Briefing I cover the Shanghai Composite Index.