Oliver's Insights - China's economy is slowing, not collapsing, & its share market looks attractive
29 July 2010 - This note takes a look at the outlook for China's economy and its share market.
The key takeouts are:
- The slowdown now underway in China should be seen as a normalisation of growth. It is unlikely to lead to a hard landing.
- China's moves to prevent overheating and rebalance its economy have been successful, and tightening measures will start to be relaxed some time in the next two to three months.
- Chinese shares have been leading global shares lately and are worth keeping an eye on. Right now they are cheap and, with policy tightening largely over, may be in the process of bottoming ahead of a leg higher into year end. If this is the case, it argurs well for Asian and Australian shares (as well as global shares generally) on a six to 12 month view.
