China Rehabilitated
Wednesday, August 31st, 2016 Categories: China, Financials, Global Equities
This week we upgrade China to overweight relative to global equities and Chinese Financials to overweight relative to the local index. There is some interesting evidence to suggest that the PBoC has begun the forced recapitalisation of Tier-2 banks. This has already caused Chinese Financials to decouple from the sector in the rest of the world and it may lead to the rehabilitation of the country as a destination for international investors.
Forced recapitalisation of Tier-2 banks has begun