Business

US-traded Chinese stocks have best week since at least March as reopening hopes help spark recovery


Shares of U.S.-traded Chinese stocks on Friday had their best week since at least March, with a popular exchange-traded fund posting its biggest weekly gain since. in 2011, when stocks recovered from last week’s severe sell-off.

KraneShares CSI China Internet ETF
KWEB,
+6.30%

rose 6.3% on Friday, bringing its weekly gain to nearly 25%, its strongest weekly performance since the week ended March 18, when it rallied 28.8%, according to Fact data. set. The closely watched ETF tracks the performance of some of the largest China-based companies with US depository receipts trading in the US

See: Chinese stocks including Alibaba, Nio rise as Chinese officials say they will boost vaccines for the elderly

Other China-focused companies and ETFs also recorded their best week in just a long time, if not longer. Chinese stocks soared in the second half of March after worries subsided that the US authorities could accelerate the delisting of some Chinese companies with ADRs traded in the US.

Meanwhile, iShares MSCI China ETF
MCHI,
+2.45%
,
rose 2.5% on Friday, posting a weekly gain of 12.3%. That performance surpassed a 12.2% gain from the week ending Nov. 4 to become an ETF’s biggest weekly gain since October 2011.

Other popular China-focused ETFs that have seen their biggest weekly gains since March include iShares China’s large-cap ETF
Forex,
+2.85%
,
Invesco Golden Dragon China ETF
PGJ,
+5,20%

and Xtrackers Harvest CSI
ASHR,
+1.17%
.

See: Why China’s COVID Policies Worry Investors

Chinese stocks traded in the US also rallied this week, with shares of Nio Inc.
NIO,
+8.60%

rose 8.6% on Friday, bringing their gain for the week to 29.1%, nearly surpassing the gain for the week ended March 18.

Alibaba Group
BAB,
+4.79%

up 4.8% on Friday, bringing the weekly gain to 19.3%, while Tencent Holdings
TCEHY,
+3.69%

up 3.7% to end the week 12% higher.

Chinese stocks are still down sharply since the start of the year, reflecting the intense turmoil that has rocked Chinese markets as concerns over harsh COVID-19 measures and the increasingly hostile stance of President Xi Jinping towards the West has contributed to reducing investor demand. The Biden Administration’s efforts to cut off China’s access to some key technologies in the semiconductor sector have contributed to the tension.

This week’s rally was boosted by expectations that Beijing could significantly ease COVID-19 restrictions after authorities removed some testing requirements, but Chinese stocks also saw gains. benefit from expectations that the Federal Reserve might raise interest rates by just 50 basis points in December, said Thomas Matthews, senior market economist at Capital Economics.

China-focused ETFs recorded strong inflows this week of $1.2 billion, according to a note from Sean Darby, global equity strategist at Jefferies.

Some of the worst civil unrest in decades rocked China late last month after a deadly apartment fire broke out in Urumqi, the regional capital of China’s Xinjiang region. Country. Some residents blamed the government’s blockade measures for increasing the death toll, as barriers installed to stop movement are believed to have hampered the response to the blaze, which has already spread. inspiration for protest movements, such as MarketWatch reported.

However, some of the reopening-inspired gains in Chinese stocks may be short-lived, as Matthews explains.

“First, to us, subsequent crackdowns on protests seem more likely than substantial assent to the protesters’ demands,” Matthews said. “That could shake investor confidence. Harsh treatment of protesters would increase the threat of China sanctions by the US and others, or at least an increase in ‘decoupling’ trends that have been underway for some time. .

news7f

News7F: Update the world's latest breaking news online of the day, breaking news, politics, society today, international mainstream news .Updated news 24/7: Entertainment, Sports...at the World everyday world. Hot news, images, video clips that are updated quickly and reliably

Related Articles

Back to top button