China’s economy came “roaring back to life” in the first quarter. So why are the A-shares and even the iShares FTSE China (FXI 24,02 -0,11 -0,46%) stocks all underperforming the MSCI Emerging Markets Index?
Let’s just say the Chinese mainlander is selling on the good news.
Last week, local sentiment indicators showed the bulls were running at full power. At least two companies were suspended from trading because of wild upswings of 20% or more in their share price.
Beijing Building Materials Group was one of them. Better known as BBMG, it saw its shares rise 61%…in five days. That includes the 10% gain from today. The shares were suspended from trading for 24 hours on April 13.
These trading suspensions may have hurt investor confidence, giving the locals a reason to pause, or cash out, analysts from Shanghai based advisors Jyah Asset Management believe. For close China watchers, 3300 is the resistance level in the SSE Composite Index, analysts from Jyah said.
“We are advising investors to be cautious and not blindly chase the market,” they said in a note to clients. For stock pickers, they recommend the same segment that most China specialists here are recommending: finding the best priced companies with a domestic economy focus in areas like medicine, telecommunications and mobile, consumer goods and state-owned-enterprises that are becoming more market driven.
China reported first quarter GDP growth of 6.9%, beating market consensus estimates. The economy benefited from a strong housing market, infrastructure investment, exports and retail sales. In nominal terms, real GDP grew 11.8% in the first quarter of 2017, the fastest since the first quarter of 2012 when real GDP rose by 8.1%. China Advisor Says A-Shares Market Carried Away
China’s economy came “roaring back to life” in the first quarter. So why are the A-shares and even the iShares FTSE China (FXI 24,02 -0,11 -0,46%) stocks all underperforming the MSCI Emerging Markets Index?
Let’s just say the Chinese mainlander is selling on the good news.
Last week, local sentiment indicators showed the bulls were running at full power. At least two companies were suspended from trading because of wild upswings of 20% or more in their share price.
Beijing Building Materials Group was one of them. Better known as BBMG, it saw its shares rise 61%…in five days. That includes the 10% gain from today. The shares were suspended from trading for 24 hours on April 13.
These trading suspensions may have hurt investor confidence, giving the locals a reason to pause, or cash out, analysts from Shanghai based advisors Jyah Asset Management believe. For close China watchers, 3300 is the resistance level in the SSE Composite Index, analysts from Jyah said.
“We are advising investors to be cautious and not blindly chase the market,” they said in a note to clients. For stock pickers, they recommend the same segment that most China specialists here are recommending: finding the best priced companies with a domestic economy focus in areas like medicine, telecommunications and mobile, consumer goods and state-owned-enterprises that are becoming more market driven.
China reported first quarter GDP growth of 6.9%, beating market consensus estimates. The economy benefited from a strong housing market, infrastructure investment, exports and retail sales. In nominal terms, real GDP grew 11.8% in the first quarter of 2017, the fastest since the first quarter of 2012 when real GDP rose by 8.1%.