Tags: China | stocks | rebound | asia

China Stocks Rebound With a Vengeance

By    |   Tuesday, 18 Feb 2014 10:09 AM

Chinese stocks have bounced back from sharp declines in January amid central-bank support for the banking system and a decline in new listings on the stock market this month.

This recovery has come while the stock markets of some other emerging markets remain underwater.

The Shanghai Composite Index, rose 0.9 percent Monday, putting it up 0.9 percent year-to-date as well, The Wall Street Journal reports. The index dropped 6.8 percent in 2013 and then fell another 6.2 percent as of Jan. 20. Since then, the index has soared 7.6 percent.

Editor’s Note: Get These 4 Stocks Before 399% Stock Market Rally!

"The . . . market has already priced in a lot of the pessimism toward the Chinese economy," Huang Cuiyu, portfolio manager at Shanghai-based HFT Investment Management, told The Journal.

"Even if you think China's economy is slowing, valuations in traditional sectors like banks and household appliances are still cheap."

Some investors expect more gains to come, with stalwart state-run companies sporting cheap valuations and 2013 earnings expected to be strong, The Journal reports.

But others say a slowing economy, troubles in the financial system and an expected revival of new share listings will hold the market back, according to the paper.

In a Feb. 10 report, Michael Yu, a strategist at JPMorgan in Hong Kong, recommended that clients buy Chinese stocks, "based on seasonality and all-time low valuations," Bloomberg reports.

"We expect a 15-20 percent market rebound in the coming weeks, once growth stabilizes due to seasonality and the market’s focus switches to structural reforms," he wrote.

Editor’s Note: Get These 4 Stocks Before 399% Stock Market Rally!

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Chinese stocks have bounced back from sharp declines in January amid central bank support for the banking system and a decline in new listings on the stock market this month.
China,stocks,rebound,asia
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2014-09-18
Tuesday, 18 Feb 2014 10:09 AM
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