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Global Chinese stocks and bonds rose by $ 120bn in 2021

Global reserves of Chinese stocks and bonds jumped by about $ 120bn in 2021 as foreign investors pushed the country’s markets despite recent instability and Beijing violations.

Investors in other countries saved Rmb7.5tn ($ 1.1tn) as well as fixed income from renminbi at the end of September, reaching approximately Rmb760bn from the end of 2020, according to a Financial Times estimate.

The rise shows how investors are reaching Chinese markets directly, not through financial instruments listed in global financial institutions such as New York and Hong Kong. It comes at a time when some experts and investors are complaining about strong returns in developed markets he may be tired, leading them to look for opportunities elsewhere.

Chinese maritime records have a noisy year, a series of lawsuits undermined the confidence of investors in the sectors from technical to academic. A financial problems for the producer Evergrande, meanwhile, has led to heavy sales of dollar bonds sold worldwide, high yields from Chinese retailers.

But capital has grown very connected and Chinese domestic currency for diversity and to repay large sums of money.

Advertisers have relied heavily on listed companies in New York and Hong Kong such as Alibaba and Tencent to promote themselves in China, among others due to the high level of reliability offered by the maritime markets.

But since July, major Chinese technical groups that have been registered abroad have been hit by a the amount of regulatory restrictions from Beijing, providing a lot of losses to well-known owners including SoftBank Vision Fund and Baillie Gifford.

“Now, the law is another way. [US-listed stocks] it can’t be sold because of the overcrowding of the system, ”said Hong Kong’s chief financial officer. Advertisers are looking for interesting articles called A-sections published in Shanghai and Shenzhen, the manager added.

Michelle Lam, a Chinese economist at Société Générale, said buying in the Chinese market was aided by FTSE RussellThe idea of ​​last year’s increase in Chinese government debt on its major World Government Bond issues, repair method more than $ 140bn in most cases.

He also added that they are Chinese financial endurance even the recent financial crisis has “strengthened public confidence in the purchase of renminbi property”.

More and more Chinese purchases have taken place motivated opposition from high bankers, including George Soros, who in September asked the US Congress to enact legislation that would help the Securities and Exchange Commission reduce its foreign exchange reserves.

But greater importance means that such calls have had little effect. The earnings in the 12 months to the end of September have taken foreign renminbi bonds above Rmb3.9tn, according to central bank figures, while foreign shares have risen by about Rmb3.6tn – all showing an increase of about 30 percent from a year earlier.

The increase in foreign exports in 2021 was not comparable to a large amount in 2020, probably due to recent space shortages and power outages weight on size. However buying shares through Hong Kong’s Stock Connect program, in particular, has been significant, with total revenues exceeding $ 50bn this year.

Chinese officials have received foreign exchange in the hope of overcoming the instability created by the stock market, especially in equities. Over the past decade, the share of gymnastics has fallen from 66 percent to 30 percent, while foreign investment has risen to 6 percent, according to Investment China Renaissance bank estimates.

Investigators said foreign traders were already developing coastal routes. “People are getting a lot of information from foreign investors,” said Bruce Pang, chief of research at China Renaissance.

Cumulative net Chinese stock chart via Stock Connect ($ bn) showing Stock Connect purchases rising sharply.

Foreign trade of maritime stocks and bonds has increased as western banks combined Goldman Sachs and JPMorgan pressuring them to obtain licenses with organizations that have everything in China, which has led to a lot of research on Chinese companies. HSBC and Fidelity recently became positive on Chinese goods for the first time since the crime began in July.

But foreign fund managers face unique challenges in selling offshore shares, including 30 percent of China’s foreign ownership. At least nine of the listed companies in Shanghai are close to reaching foreign ownership limits, according to brokers and stock exchange data.

More corporate purchases can lead to a return to overseas investors when local businesses hold office. “When real estate agents find that customers are buying, they drive forward,” said the Hong Kong bag manager. “Visitors are always late for parties in China.”


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