Global investors are rapidly increasing their exposure to Chinese equity markets, driven by improving economic fundamentals, strong policy support, and a series of reforms aimed at stabilizing and revitalizing the economy.
As of Monday, qualified foreign institutional investors (QFII) had appeared among the top ten tradable shareholders of more than 70 listed companies in their disclosed semi-annual reports, with a total holding value of 6.8 billion yuan (about 949 million U.S. dollars).
Major international financial institutions, including Goldman Sachs and UBS, have also upgraded their outlook on Chinese assets, citing improving fundamentals and strong policy support.
New investments from these institutions are primarily focused on high-growth sectors such as technology, advanced manufacturing, automotive, and pharmaceuticals -- areas seen as central to China's long-term economic transformation. "We have noticed that recent policies across various domains in China have been generally supportive of the stock market performance. If we can successfully rein in self-cannibalizing competition, the resulting improvement in corporate profit margins will help strengthen the broader economic performance. This has already contributed to a noticeable boost in investor enthusiasm and confidence. Notably, we have seen increased interest from overseas long-term investors, including pension funds and active global asset allocators, who have been actively engaging with us to better learn about investment opportunities in China," said Fu Si, China portfolio strategist at Goldman Sachs.
China's policy measures to curb cutthroat competition across industries are gaining momentum, delivering positive outcomes for the broader economy, according to Zhao Yaoting, global market strategist at Invesco for Asia Pacific (excluding Japan).
"To date, more than 50 measures to address hyper-competition have been implemented across 16 different industries, which could soon lead to more sustainable business practices and stronger corporate profits. More importantly, I think these measures are likely to help reflate the Chinese economy. And just look at the recent Chinese bond yields on the rise, which serves as a good proxy," Zhao said.
The renewed investor confidence is reflected in the performance of China's A-share market, which has entered a bull run. On Monday, the total market capitalization of A-shares surpassed 100 trillion yuan for the first time, marking a significant milestone and underscoring the growing appeal of Chinese equities to global capital.
Global investors increase exposure to Chinese equities as confidence rebuilds up
Global investors increase exposure to Chinese equities as confidence rebuilds up
Global investors increase exposure to Chinese equities as confidence rebuilds up
