Uddrag fra The Market EAr
China changes the game
“We raise China to overweight and increase our MXAPJ index target on higher earnings and valuations.” (Goldman)
Source: Goldman
Sharper China rally
The current rally is sharper than most previous policy-driven ones.
Source: FactSet
More convincing this time around
China stimulus looks more convincing this time around: off-setting geopolitical concerns?
Source: Macrobond
Stimulus history
China stimulus in ’08, ’16, ’20 followed by a rise in valuations.
Source: BofA quant
10 bear market rallies
Prior to the current rally, there were 10 rallies of 10% or more since the start of the bear market that all proved transitory and led to heightened investor skepticism about policy efficacy.
Source: FactSet
Lowest positioning in a decade
Based on EPFR data, mutual funds globally in aggregate have 5% allocation in Chinese equities as of end-August, the lowest over the past decade.
Source: EPFR
2nd largest ever
2nd largest weekly inflow ever to China equity funds.
Source: Flow Show
Valuation below mean
China’s valuation is moderately below mean even after the powerful rally: our macro model indicates further valuation expansion.
Source: FactSet
The Japan comparison
Japan’s equity market staged 7 substantial rallies during its extended bear market, showing investment opportunities can exist within a challenging macro backdrop.
Source: FactSet
Not bad
Total shareholder yield of global markets.
Source: Soc Gen
Bargain?
China banks– Price-to-book ratio.
