Foreign Investors Are More Upbeat on Mainland Equities Than Chinese Traders
Chen Juan
DATE:  Jan 15 2019
/ SOURCE:  yicai
Foreign Investors Are More Upbeat on Mainland Equities Than Chinese Traders Foreign Investors Are More Upbeat on Mainland Equities Than Chinese Traders

(Yicai Global) Jan. 14 -- Despite China's stock market pulling back more than 20 percent in 2018, so far this year overseas investors have shown greater enthusiasm for mainland equities than their domestic counterparts.

International players invested an average CNY2.1 billion (USD311 million) a day over the past eight trading days, up from the CNY900 million (USD133.2 million) in December, according to a report published by China International Capital, a major brokerage. The one-day net inflow of CNY6.8 billion on Jan. 9 was the highest since Dec. 4, the report added.

Foreign investors are more optimistic about the Chinese market than their fellow traders in China, influenced by country comparison, investment duration, emotional impact and other factors, according to the report.

CICC said that the nation's stock market is now at the bottom of a historical range, which bears medium- and long-term appeal in terms of international comparison. In addition, overseas investors have reason to favor the local market because of government policies signaling stable growth and steady progress in China-US trade talks.

There are also two more reasons for overseas investors to be optimistic about China and its stock market. Morgan Stanley Capital International will announce the results of consultations on increasing the proportion of so-called A-shares, or mainland-traded stocks, at the end of February, while the Financial Times Stock Exchange 100 Index and the S&P 500 Index will also include A-shares.

Overseas investors have opted for blue chip stocks such as distillers Kweichow Moutai and Wuliangye Yibin, as well as consumer electronics makers Gree Electric Appliances, Midea Group and Qingdao Haier.

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Keywords:   MSCI,CICC