Strategists predict that China’s markets will deliver significant gains to investors this year, as the country’s reopening has sparked renewed interest in foreign investing. The Hong Kong Hang Seng index has already increased by nearly 10% year-to-date, and mainland markets such as Shanghai have seen similar growth. However, experts warn that the potential success of China’s markets may be hindered by the ongoing spread of Covid-19 and the challenges of re-integrating the economy with the global market.
Investing outside of the United States is becoming increasingly appealing, as the dollar weakens and is expected to decline further. The iShares MSCI Emerging Markets ETF, which includes companies from China, has already seen a return of 8.5% year-to-date, whereas the S&P 500 has only increased by around 2% in early 2023.