According to Reuters’ estimates, the 2023 year was tough for China’s stock market. At the end of 2023, shares of China’s major companies were recognized to be the worst performers among global stocks as they ended up with a whopping loss of 10%.
China’s stock market is opening a new 2024 year, licking wounds after its dismal performance in 2023. Chinese stocks could not meet the economic challenges that popped up in 2023.
Experts say that most Chinese stocks logged weak dynamics throughout the whole of 2023. Stock markets in Shanghai and Hong Kong slumped by more than 10%, though they both clicked into gear on the final week of the year.
Hang Seng, the benchmark stock market index for the Hong Kong Stock Exchange, tumbled by 14% whereas the Shanghai-traded CSI300 plunged by 11%. The CSI300 had been falling for three years in a row which was the longest losing streak in history. The sub-index of Chinese developers collapsed by 39%.
China-based macro hedge fund manager Li Bei said that a surge in buying activity at the end of 2023 looks like an attempt to find out the bottom. The expert believes that China’s stocks will pick up steam in 2024. Li Bei reckons that some stocks will gain ground.
Earlier, Bill Witherell, the chief global economist at Cumberland Advisors, also acknowledged a downturn in China’s stock market which he termed a headache for investors in 2023. Nevertheless, analysts at Jefferies are betting on positive changes in 2024. Their bullish outlook is based on fiscal stimulus programs introduced by China’s authorities as well as on the yuan’s reinforcement.
In the recent months of 2023, China’s equity market was crippled by the mass exodus of foreign investors. As a result, Chinese stocks tumbled by 87% from their peak of $33 billion recorded in August 2023. As of today, the total market value of China's stocks is $4.4 billion. Experts pinpointed the reasons behind the capital flight such as bottlenecks aroused in the cause of economic recovery, the lack of transparency in China’s statistics, and the manipulation of economic data by China’s authorities.