{"id":48296,"date":"2023-08-14T15:36:41","date_gmt":"2023-08-14T19:36:41","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/china-focused-etfs-drop-as-countrys-property-woes-highlight-recession-risks-in-china-are-real\/"},"modified":"2023-08-14T15:36:44","modified_gmt":"2023-08-14T19:36:44","slug":"china-focused-etfs-drop-as-countrys-property-woes-highlight-recession-risks-in-china-are-real","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=48296","title":{"rendered":"China-focused ETFs drop as country\u2019s property woes highlight \u2018recession risks in China are real\u2019"},"content":{"rendered":"
\n

Exchange-traded funds that buy Chinese stocks were sliding Monday, extending back-to-back weekly losses after China\u2019s disappointing economic data and fresh worries cast a cloud over the country\u2019s property sector.<\/p>\n

Shares of the iShares MSCI China ETF
\n MCHI,<\/span>
\n which has about $8 billion of assets under management, were down 0.8% on Monday while on pace for their worst month since May, according to FactSet data, at last check. The fund\u2019s largest holdings on Aug. 11 included Tencent Holdings
\n 700,
\n -0.77%<\/bg-quote>,<\/span>
\n Alibaba Group Holding
\n 9988,
\n -2.62%<\/bg-quote>,<\/span>
\n Meituan
\n 3690,
\n -1.31%<\/bg-quote>,<\/span>
\n China Construction Bank Corp.
\n 939,
\n -1.64%<\/bg-quote>
\n and JD.com Inc.
\n 9618,
\n -1.30%<\/bg-quote>,<\/span>
\n according to data on BlackRock\u2019s website.<\/p>\n

\n

Concerns about China\u2019s economy increased Monday after Country Garden Holdings Co. suspended trading in some offshore bonds, \u201creminding investors of Chinese property market volatility from years ago and reinforcing that recession risks in China are real,\u201d Tom Essaye, founder and president of Sevens Report Research, said in a note. He also cited \u201cdownbeat trade data out of China\u201d last week, with imports and exports both missing estimates.<\/p>\n

The iShares MSCI China ETF has tumbled around 8.7% so far in August, while the KraneShares CSI China Internet ETF has seen a steeper plunge of more than 10%. The KraneShares CSI China Internet ETF
\n KWEB,<\/span>
\n with around $6 billion of assets under management, was also on pace for its worst monthly performance since May, according to FactSet data at last check.<\/p>\n

\u201cFurther evidence of a deeper growth deceleration in China is a clear near-term risk to sentiment and earnings,\u201d said Solita Marcelli, chief investment officer for the Americas at UBS Global Wealth Management, in a note Monday. She pointed to property challenges and \u201ctepid Chinese credit data on Friday,\u201d saying the volume of new loans in July was weaker than expected probably because of \u201cintensified advanced mortgage repayments and a sequential deterioration in housing sales.\u201d<\/p>\n

Shares of other China-focused ETFs were also falling Monday, with the Xtrackers Harvest CSI 300 China A-Shares ETF
\n ASHR
\n off 0.3% and the Rayliant Quantamental China Equity ETF
\n RAYC
\n down 0.5% while the KraneShares CSI China Internet ETF shed 0.4%, according to FactSet data, at last check.<\/p>\n

\u201cWe view the sharp data miss on credit as another signal that end demand remains weak amid the lackluster support measures from Beijing so far,\u201d said Marcelli. \u201cOn the other hand, a deteriorating macroeconomic picture should increase pressure on policymakers to promptly take more forceful stimulus steps to stem pressure and support growth in the second half.\u201d<\/p>\n

In anticipation of a potential turn to more supportive policies, she said that within Chinese equities UBS is keeping \u201cour growth-tilted barbell approach by holding policy beneficiaries like consumer and internet as well as defensive sectors for downside protection on the other side.\u201d<\/p>\n

China-focused ETFs have suffered losses this year, with the iShares MSCI China ETF falling 4.3%, the Xtrackers Harvest CSI 300 China A-Shares ETF sliding 4% and KraneShares CSI China Internet ETF dropping 5% and the Rayliant Quantamental China Equity ETF tumbling more than 14%, according to FactSet data, at last check. <\/p>\n

All four funds were down Monday after sliding the past two consecutive weeks.<\/p>\n

Jennifer McKeown, chief global economist at Capital Economics, said in a note Monday that it appears \u201cthe immediate global economic and market fallout from troubles\u201d at Country Garden will likely be limited. But she also cautioned that \u201cthe developer\u2019s problems are indicative of a structural downturn which will shape the global economy for years to come.\u201d<\/p>\n

China, the world\u2019s second-largest economy, faces demographic challenges with a falling population while \u201ca combination of over-investment and a reluctance to let the market do more of the work in allocating resources will contribute to a slowdown in productivity growth,\u201d according to a separate note Monday from Capital Economics.<\/p>\n

Read:<\/strong> China-focused ETFs fall after country\u2019s growth disappoints, deepening 2023 losses<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Exchange-traded funds that buy Chinese stocks were sliding Monday, extending back-to-back weekly losses after China\u2019s disappointing economic data and fresh worries cast a cloud over the country\u2019s property sector. Shares of the iShares MSCI China ETF MCHI, which has about $8 billion of assets under management, were down 0.8% on Monday while on pace for […]<\/p>\n","protected":false},"author":1,"featured_media":48297,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[241],"tags":[83],"class_list":["post-48296","post","type-post","status-publish","format-gallery","has-post-thumbnail","hentry","category-markets","tag-featured","post_format-post-format-gallery"],"yoast_head":"\nChina-focused ETFs drop as country\u2019s property woes highlight \u2018recession risks in China are real\u2019 | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Exchange-traded funds that buy Chinese stocks were sliding Monday, extending back-to-back weekly losses after China\u2019s disappointing economic data and\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" 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