High return opportunities – with high risk

Stock market prices in Shanghai

Many analysts see a lot of potential in the Chinese stock market in 2023. But that was already the case in 2022.

(Photo: Getty Images)

Dusseldorf In addition to inflation, China is the topic that is currently driving the financial market the most: After the government relaxed its strict corona policy, the number of infections rose drastically. Analysts therefore assume that the world’s second largest economy will not recover until the end of the first quarter of 2023 at the earliest.

The fact that China relaxed its Covid restrictions initially triggered a rally on the stock markets. The Hang Seng index of the largest companies on the Hong Kong Stock Exchange has risen 35 percent since its low for the year in late October. The CSI 300, which tracks developments on the mainland Shanghai and Shenzhen stock exchanges, rose 11 percent over the same period.

Most recently, however, both indices have only been moving sideways. This suggests that after the initial euphoria, investors are now waiting to see whether the government will stick to its policy despite the rising number of cases, and for signs of how the economy is developing.

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