Global investors are showing renewed interest in Chinese markets as Beijing intensifies efforts to reverse the economic slowdown and stimulate long-term stock market growth. This sentiment shift is encouraging more cash flow into equities despite modest expectations for a rapid growth boom.
Beijing’s steps to attract investment and boost consumer spending have made the lower valuations of Chinese companies more appealing. Several money managers overseeing over $1.5 trillion in client funds have indicated cautious optimism. Gabriel Sacks, an emerging market portfolio manager at Abrdn (which manages $677 billion in assets), noted that the firm had “selectively” invested in Chinese stocks last week. However, they remain disciplined and are waiting for more detailed policy actions from Beijing after recent economic support pledges led to a stock market rally.
China’s economic challenges persist, as factory activity declined for the fifth consecutive month and the services sector slowed significantly in September, adding urgency to Beijing’s efforts to meet its 2024 growth target of 5%.
