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Goldman Turns Bullish on China Equity, HK-China Bond Connect Forthcoming

March 20, 2017

Another week, another compelling new measure to liberalize China’s bond market. Premier Li suggested that a Hong Kong-China Bond Connect will open as soon as this year. Good news abounds on the equities front as well. Market bigwig Goldman Sachs upgraded China’s stock market to overweight, projecting a ~25% increase in the MSCI China Index in 2017.

In more neutral news, international investors are also keeping a close eye on China’s interest rates. Last week saw a 10 bps increase in standing and medium-term lending facility rates following the US hike, though the PBOC swears that the movement was driven by market forces rather than policy. Needless to say, investors are dubious.

Topics covered: Hong Kong-China Bond Connect, Bullish Equity Market Views, China’s First Civil Code

 

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The views expressed represent an assessment of market conditions at a specific point in time, are opinions only and should not be relied upon as investment advice regarding a particular investment or markets in general. Such information does not constitute a recommendation to buy or sell specific securities or investment vehicles.