Industry Voice: Gains still to be found in Chinese equities

Corporate earnings will likely be the focus after a post‑pandemic recovery.

clock • 3 min read
Industry Voice: Gains still to be found in Chinese equities

China's economy is on the right track to recovery in 2021. We expect the Chinese consumer to play a bigger role this year, thanks to pent‑up demand. Successive holidays and festivals have been accompanied by improving consumer confidence. Residential property, one of the first sectors to recover, remains well supported. Sectors exposed to developed markets economic recoveries might also benefit, as well as export manufacturers leveraged to global trade.

We believe the COVID‑19 vaccination rollout should facilitate a further rebound in those business and consumer services that have been lagging, such as food, hotels, entertainment, and personal services. Though the country's international borders remain shut, domestic air travel and tourism have rebounded strongly. During the Labor Day holidays in early May, the number of domestic tourist trips reached a record 230 million, 3.0% more than in 2019.1 As China ramps up its vaccination program, we should see a more visible path for opening international borders in 2022.

 

 

 

1 Source: Chinese Ministry of Culture and Tourism.

 

Important Information

For professional clients only. Not for further distribution.

This material is being furnished for general informational purposes only. The material does not constitute or undertake to give advice of any nature, including fiduciary investment advice, and prospective investors are recommended to seek independent legal, financial and tax advice before making any investment decision. T. Rowe Price group of companies including T. Rowe Price Associates, Inc. and/or its affiliates receive revenue from T. Rowe Price investment products and services. Past performance is not a reliable indicator of future performance. The value of an investment and any income from it can go down as well as up. Investors may get back less than the amount invested.

The material does not constitute a distribution, an offer, an invitation, a personal or general recommendation or solicitation to sell or buy any securities in any jurisdiction or to conduct any particular investment activity. The material has not been reviewed by any regulatory authority in any jurisdiction.

Information and opinions presented have been obtained or derived from sources believed to be reliable and current; however, we cannot guarantee the sources' accuracy or completeness. There is no guarantee that any forecasts made will come to pass. The views contained herein are as of the date noted on the material and are subject to change without notice; these views may differ from those of other T. Rowe Price group companies and/or associates. Under no circumstances should the material, in whole or in part, be copied or redistributed without consent from T. Rowe Price.

The material is not intended for use by persons in jurisdictions which prohibit or restrict the distribution of the material and in certain countries the material is provided upon specific request.

It is not intended for distribution to retail investors in any jurisdiction.

This material is issued and approved by T. Rowe Price International Ltd, 60 Queen Victoria Street, London, EC4N 4TZ which is authorised and regulated by the UK Financial Conduct Authority. For Professional Clients only.

© 2021 T. Rowe Price. All rights reserved. T. ROWE PRICE, INVEST WITH CONFIDENCE, and the bighorn sheep design are, collectively and/or apart, trademarks or registered trademarks of T. Rowe Price Group, Inc.

Advertisement

More on Equities

Bullish outlook in January

Fund managers bank on global reopening in bullish outlook beyond Covid

71% anticipate 'boom'

clock 18 January 2022 • 3 min read
Abhi Chatterjee of Dynamic Planner
UK

Deep Dive: Feeling of déjà vu about UK equities

Tech companies just 5% of UK index

Abhi Chatterjee
clock 14 January 2022 • 3 min read
Amanda Burdge of Quantum Advisory
UK

Deep Dive: Reasons to consider UK equity allocation

UK equities have lagged

Amanda Burdge
clock 14 January 2022 • 3 min read
Trustpilot