Global investors looking into China amid tensions with the U.S.
Amid the economic chaos, investors all around the world are exploring opportunities in China.
According to recent reports, some analysts are claiming that China may become an economic powerhouse once the coronavirus pandemic ends.
In addition, the coronavirus crisis has sent global capital into Chinese stocks and other strategists are seeing this as part of a longer-term trend.
As per the fund flow data from EPFR, U.S. stocks plunged to three-year lows in March while more than 800 funds reached nearly a quarter of nearly US$2 trillion [AU$3.11 trillion] allocated in Chinese stocks.
Also to wrap up the week, the majority of Asian stock markets also attempted to rebound over China’s industrial output production reporting better results than expected.
However, some analysts may want to reconsider investing in China since it is also known for taking over assets of other countries that don’t pay their debts on time.
Market outlook: U.S. plummets, China emerges
Recently, Dow Jones just recorded its worst loss for the week losing over 500 points due to the Fed warning. In addition, the White House has recently had its conflicts as well with trying to reopen U.S. states.
Because of these events, China may secretly take advantage of this situation. They have continued pushing on their technology initiatives for this year. With the oil market in another possible turmoil, they might even grab this opportunity to buy more.
According to Justin stock ma Leverenz, a senior portfolio manager for an emerging equity market team at Invesco, he sees the Chineserket as the next new opportunity given local innovations in health care and technology.
He observed that every decade U.S. technology and Japanese stocks have a significant bull market and he views China as a supermajority driver of growth over the next 10 years.
Tensions continue to intensify for America and China
In recent developments, President Donald Trump has continued pointing fingers in blaming China for the chaos that it has done to the entire world.
As per Bloomberg, the president does not want to re-negotiate its phase one trade deal with Xi Jinping which will likely eradicate its largest trading relationship in the world amid the coronavirus outbreak.
In an interview on Fox Business Network, Trump also mentioned that he could cut off its relationship with China, saving “US$500 billion.”
With the U.S. continuing to threaten China, the trade deal may hang in the balance putting America economically in the worst position.
Featured image courtesy of Suzy Hazelwood/Pexels