INVESTOR sentiment towards China has swung from one extreme to another. After rallying by 59 per cent from the bottom in October 2022, MSCI China corrected by 19 per cent from the peak, despite posting 19 per cent year-on-year earnings growth for the first quarter.
Leading economic indicators in April and May have been sequentially weaker after a strong rebound in the first quarter of this year from the reopening of the economy. Youth unemployment remains high at 20.4 per cent, as companies are reluctant to hire due to soft consumer demand, and consumers are unwilling to spend due to the weak labour market.
Weaker-than-expected recovery in the property market and an ageing demographic have further...
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