Foreign investment flowing rapidly out of China and the US market has turned into a Bull. Joe Biden’s policies winning.
Foreign investors have been dumping vast amounts of Chinese assets, and putting money there will only get riskier (msn.com)
"But foreign fund managers have already stolen a march on the policy: They've been selling vast amounts of securities over the past two years in response to Chinese leader Xi Jinping's policies and mounting US-China tensions," wrote Jeremy Mark, a senior fellow with the Atlantic Council's Geoeconomics Center.
In fact, international institutional investors have sold a net $148 billion of China's bonds since early 2022, and Chinese stocks have seen sharp declines, especially on exchanges in New York and Hong Kong, he said.
......................
Separate reports have also shown that foreign investors are selling Chinese stocksat a faster pace. And a former IMF official predicted China's economy is likely headed for a so-called lost decade. Mark said that this shift in market sentiment underscores how de-risking is as much about the bottom line as it is about diplomacy. "And it does not bode well for China amid growing anxiety about the country's economic prospects," he added.
................................
Mark acknowledged Chinese efforts to bring back some overseas investment, but foreign capital flows are set to keep declining, especially with new US restrictions on the horizon. Already, private equity investments in China led by Americans fell 76% last year.
"Combined with recent Biden administration restrictions on sales to China of advanced semiconductors and cutting-edge chip-making gear, the message to all classes of investors will be clear: Putting money in China is going to become riskier, and de-risking is only going to become more commonplace," he concluded.
Foreign investors have been dumping vast amounts of Chinese assets, and putting money there will only get riskier (msn.com)
"But foreign fund managers have already stolen a march on the policy: They've been selling vast amounts of securities over the past two years in response to Chinese leader Xi Jinping's policies and mounting US-China tensions," wrote Jeremy Mark, a senior fellow with the Atlantic Council's Geoeconomics Center.
In fact, international institutional investors have sold a net $148 billion of China's bonds since early 2022, and Chinese stocks have seen sharp declines, especially on exchanges in New York and Hong Kong, he said.
......................
Separate reports have also shown that foreign investors are selling Chinese stocksat a faster pace. And a former IMF official predicted China's economy is likely headed for a so-called lost decade. Mark said that this shift in market sentiment underscores how de-risking is as much about the bottom line as it is about diplomacy. "And it does not bode well for China amid growing anxiety about the country's economic prospects," he added.
................................
Mark acknowledged Chinese efforts to bring back some overseas investment, but foreign capital flows are set to keep declining, especially with new US restrictions on the horizon. Already, private equity investments in China led by Americans fell 76% last year.
"Combined with recent Biden administration restrictions on sales to China of advanced semiconductors and cutting-edge chip-making gear, the message to all classes of investors will be clear: Putting money in China is going to become riskier, and de-risking is only going to become more commonplace," he concluded.
Last edited:
