CNBC reporting on Goldman Sachs China stock marekt and economy views.
Main points:
- Goldman Sachs expects the MSCI China and CSI 300 to rise 12% and 15%, respectively, supported by estimated earnings growth of around 10% and “moderate” valuation gains.
- Goldman Sachs prefers A shares over H shares due to their lower sensitivity to geopolitical and liquidity factors.
- In its 2024 China equity outlook, Goldman Sachs upgraded the food and beverage sector to overweight from market weight and the technology hardware sector to overweight from underweight.
More:
- “We believe policy has been implemented across all key policy cohorts when it comes to monetary easing, fiscal stimulus, housing market easing and, importantly, deregulation in the tightening of the industry in recent years “
- China’s central government has signaled that it has shifted to a more supportive policy stance – even as it has backed away from aggressive support
- Goldman Sachs noted that both investment and hedge fund mandates worldwide have had low allocations to Chinese stocks for several years.
- “Consensus earnings estimates look bullish for 2024 and 2025, but embedded within the suppressed valuations is an arguably pessimistic policy and/or geopolitical outlook, suggesting a right-side return distribution as these concerns fade”
