China's asset boom! The Nasdaq China Golden Dragon Index has risen nearly 15% in two weeks
lee382
发表于 2024-5-4 17:03:47
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Since April, with the continuous adjustment of multiple overseas markets such as the US stock market, European stock market, and Japanese stock market, global funds have increased their attention to Chinese assets.
In the US stock market, the Nasdaq China Golden Dragon Index has recently recorded a strong rebound, rising 14.86% in 10 trading days from April 22 to May 3, marking the largest consecutive two-week increase since January 2023. Among them, the index rose 6.01% on May 2nd, marking the largest daily increase since the end of July last year.
In fact, since the beginning of this year, foreign investment has gradually increased its buying of Chinese assets. The report released by the International Finance Association (IIF) in late April showed that in March of this year, the Chinese stock and bond markets received net foreign purchases for the first time since June last year, with net foreign purchases of $1.7 billion and $2.1 billion respectively. The report also shows that March this year was the first time since September 2021 that both Chinese and non Chinese stock and bond markets in emerging markets experienced monthly inflows simultaneously.
The significant return of foreign investment is closely related to the direction of China's economic data. At the same time as net purchases of Chinese assets, foreign institutions are also experiencing significant changes in their expectations of Chinese assets. In the eyes of foreign giants such as UBS, Morgan Stanley, and Bridgewater, Chinese assets have become a value depression in the global stock market, and the sentiment, risk, preference, and interest of international investors in the Chinese stock market are improving.
China's assets have exploded, with the Nasdaq China Golden Dragon Index rising nearly 15% in 10 trading days
The Nasdaq China Golden Dragon Index continued its upward trend this week, rising 5.53%. Especially on May 2nd, the index surged 6.01%, reaching a new high since the end of November last year and the largest daily increase since the end of July last year.
According to Wind data, with an increase of over 8% last week, the Nasdaq China Golden Dragon Index has risen by 14.86% in the 10 trading days from April 22 to May 3, marking the largest consecutive two-week increase since January 2023.
Popular Chinese concept stocks also generally rose during the week. Fast Dog Taxi saw the most significant increase, with a cumulative increase of 147% in a week.
From the news perspective, during the May Day holiday, the tourism market continued to be booming, driving the explosion of tourism related stocks such as Kuai Gou Taxi and Huazhu. According to Ctrip data, the year-on-year growth rate of inbound and outbound tourism orders in most first and second tier cities is higher than that of domestic tourism orders, with inbound and outbound tourism orders increasing by 70% year-on-year. At the same time, the downward trend of the tourism market is further evident, with the growth rate of tourism orders in most third - and fourth tier cities and county-level destinations being higher than that in first - and second tier cities. Hotel and ticket orders in county-level areas increased by 64% and over 200% year-on-year, respectively.
From the data of the past two weeks, the stock price performance of Chinese concept stocks is even more impressive. Kuai Gou Taxi saw the largest increase, reaching 176.4%, followed by NIO with a cumulative increase of 46.6%. Beike, Bilibili, and Xiaopeng Motors also recorded increases of over 30%.
The surge of new car making forces such as NIO and Xiaopeng is mainly due to the good delivery data in April. In early May, multiple new energy vehicle companies announced their sales results for April 2024. Xiaopeng, Ideal, and NIO all performed well in terms of delivery volume. Among them, NIO's delivery volume in April increased the most year-on-year, reaching 134.6%, and Xiaopeng's delivery volume in April also increased significantly by 32.7%.
In fact, behind the explosion of Chinese assets is the sustained recovery of China's economic fundamentals. The International Monetary Fund stated in its latest World Economic Outlook report that, based on the resilience of growth in major economies such as China, it has raised its global economic growth forecast for this year by 0.2 percentage points to 3.1%. The International Monetary Fund predicts that China's economic growth in 2024 will be 4.6%, an increase of 0.4 percentage points from its forecast in October 2023.
According to CCTV News, the Economist Intelligence Unit in the UK and others predict that the fundamentals of China's economy will become more stable in 2024. The Center for Strategic and International Studies in the United States and other institutions believe that China's exports of electric vehicle batteries, electronic products, minerals, and other industries are strong, and many industries have leading global competitiveness.
Big banks such as Big Mo and Goldman Sachs sing together
The latest report released by the International Finance Association (IIF) shows that in March of this year, the Chinese stock market and bond market received net foreign purchases for the first time since June last year, with net foreign purchases of $1.7 billion and $2.1 billion respectively. The report also shows that March this year was the first time since September 2021 that both Chinese and non Chinese stock and bond markets in emerging markets experienced monthly inflows simultaneously.
At the same time as net purchases of Chinese assets, foreign institutions are also experiencing significant changes in their expectations of Chinese assets. Recently, foreign giants such as UBS, Morgan Stanley, and Bridgewater have been singing more in the Chinese market.
Morgan Stanley believes that global funds are returning to the Chinese stock market. With some funds easing their bearish sentiment towards the Chinese market, the withdrawal of global long-term investors from A-shares and Hong Kong stocks has been suspended. Suniel Tirumale, Chief Strategist for Global Emerging Markets Equities at UBS, raised the MSCI China Index rating to Overmatched earlier this week.
Rui Dalio, founder of the world's largest hedge fund Golden Bridge Water Fund, recently posted on social media that paying attention to the Chinese market is crucial for understanding the world and diversifying investments, and he will continue to invest in China. The concerns in the market about the risks involved in investing in China cannot be compared to the reasons for investing in China. The key issue is not whether I should invest in China, but how much I should invest (in China).
Goldman Sachs analysts have stated that in the past month, they have visited multiple places such as the United States, Singapore, and Tokyo, and after communicating with investors, they have found that international investors' emotions, risks, preferences, and interests in the Chinese stock market are improving. Timothy Moe, Chief Stock Strategist of Gaosheng Asia Pacific, recently stated at a media conference held by Goldman Sachs that the performance of the China Index this year has exceeded market expectations and remains optimistic about the development of the A-share market, maintaining the A-share "over allocation" rating.
Mu Tianhui believes that the Asian market has a very obvious seasonal effect, and overall, Asian markets such as China's A-shares, Japan, South Korea, and India are more worth paying attention to throughout the year. In terms of specific sectors, Mu Tianhui said that he was optimistic about cars, technology hardware, semiconductors and the Internet in Asian stock markets, and suggested investors pay attention to international business, cash dividends, artificial intelligence and other concepts.
At the media conference, Kinger Lau, Chief Chinese Equity Strategist at Goldman Sachs, believed that both A-share and Hong Kong stock valuations are attractive at the current stage. At the same time, regarding the "Several Opinions on Strengthening Supervision and Preventing Risks to Promote High Quality Development of the Capital Market" recently issued by the State Council, Kinger Lau stated that the new regulations place greater emphasis on supervision and high-quality development, which is conducive to further increasing the cost of illegal and irregular activities in the Chinese capital market, improving the quality of listed companies, and attracting more long-term funds to enter the market.
Recently, HHLR Management Co., Ltd., a subsidiary of Hillhouse, has raised a QFII fund with a scale of approximately 6 billion yuan to increase the proportion of asset allocation in China and continue to invest in the A-share market. As an independent USD secondary market investment management platform under Hillhouse, HHLR was registered and established in Singapore in 2007, and obtained QFII qualification with the approval of the China Securities Regulatory Commission in 2012.
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声明:该文观点仅代表作者本人,本文不代表CandyLake.com立场,且不构成建议,请谨慎对待。
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