Time to start investing?
Jack Siu, Greater China Investment Director at Credit Suisse, told CNBC “Street Signs Asia,” “Even after the recovery, we still find the valuation attractive.”
Before the Chinese market rebounded recently, valuations were near 10-year lows, Siu said.
“It’s going to be volatile, but it’s time to start diving in,” he said
The stock market has priced in enough of the risk premium on issues like Covid in China and lingering concerns about the property market, he added.
Can invest but be careful
On the other hand, management consultant Richard Martin warns that China is “investable but a policy-controlled market.”
Martin, managing director at IMA Asia.
“You can invest,” says Martin.
‘The arduous road ahead’
Meanwhile, Michael Yoshikami from Destination Wealth Management said it would be a “tough road ahead” for Chinese companies given the still uncertain regulatory environment.
“Just because they say they’re going to build some kind of foundation for Chinese stocks, I still think the Chinese government wants things to be stable,” said Yoshikami, the company’s founder and CEO. . “It’s still going to be pretty active and I think investors should be quite cautious with the China region right now.”
Investors are also now watching moves on the policy front in China as Beijing seeks to respond GDP growth target of around 5.5% for 2022.
In Monday. The central bank kept its benchmark lending rate unchanged.
“We expect China’s policymakers to actively support growth from here. On the macro front, in the coming weeks, we expect both a rate cut and a reduction in the reserve ratio.” mandatory (RRR) for banks, as well as strengthening fiscal spending support for the economy,” said Salman Ahmed, global head of strategic and macro asset allocation at Fidelity International, in a note on Tuesday.
RRR refers to the amount the bank needs to reserve.
– Evelyn Cheng of CNBC contributed to this report.
