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In this CIO Viewpoint – China Equities: Market recovery pushed back further – we assess the impact on this asset class of domestic macroeconomic factors (e.g. deflationary trends and weak labour markets), related policy responses and Chinese export prospects. We do not see a near-term catalyst for the equities market overall, but investors may want to position in selected sectors for medium and long term opportunities.


Key takeaways:

  • Deflationary trends and labour market concerns are among the issues weighing on domestic consumption. Foreign trade is a bright spot but the near-term outlook here is cautious.
  • We recently downgraded our 2024 GDP forecast for China from 5.0% to 4.8% in 2024, while maintaining the 2025 GDP forecast at 4.4%.
  • Chinese equities will likely move sideways in the near-term. But selected sectors could hold opportunities in the medium to long term, underpinned by pockets of growth.

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The CIO Viewpoint below is available to download. Please refer to the Important Information at the end of the memo for disclosures and risk warnings.

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