Global mutual funds reduced exposure to Chinese markets in June due to doubts about economic recovery

From Investing.com: 2024-07-29 00:41:02

Global mutual funds slightly reduced their exposure to Chinese markets in June, amid doubts about the country’s economic recovery. Active funds remained underweight on China, with EPFR data showing a 5.5% allocation to Chinese equities. Both Chinese indexes hit five-month lows due to heavy selling in Asian emerging markets.

China experienced the second-highest outflows in the past week, following Taiwan. Weak economic data and uncertainty surrounding the 2024 U.S. Presidential race contributed to negative sentiment towards China. The government has not provided clear stimulus plans, with little information revealed during the Third Plenum of the Chinese Communist Party.

Despite the lack of concrete stimulus measures, local stock markets in China were seemingly supported by government intervention. State-backed asset managers likely drove buying in domestic exchange-traded funds and stocks. Asian funds outside Japan showed bullishness towards Singapore, Hong Kong, and Indonesia, while maintaining underweight positions on China, Taiwan, and Malaysia according to GS analysts.



Read more at Investing.com: Mutual funds seen reducing China exposure in June- Goldman Sachs By Investing.com