China and India Stock Markets Seen Outperforming Japan in Second Half of 2024

Investors are turning their attention to emerging markets in Asia, with China and India’s stock markets expected to outperform Japan in the latter half of 2024.

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A survey by Bloomberg News of nearly 20 Asia-based strategists and fund managers revealed that a significant portion (around a third) believe Chinese stocks will deliver the strongest returns over the next six months. A similar number of participants indicated India as their top pick, while Japan came in a distant third.

This shift in preference seems to be driven by a focus on emerging market themes. Chinese stocks are viewed as attractive due to their currently low valuations, along with anticipation of upcoming policy changes that could stimulate the economy. India’s post-election optimism and relative resilience to global geopolitical tensions are also seen as positive factors.

Joseph Little, global chief strategist at HSBC Asset Management, echoed this sentiment in his midyear outlook, stating his belief that “valuation discounts and broadening global growth present an opportunity for emerging markets, particularly in Asia, to lead in the second half of the year.”

The recent performance seems to support this outlook. The MSCI EM Asia Index has already outperformed the broader MSCI Asia gauge by the most significant margin since 2009 in the last quarter.

While these predictions suggest promising prospects for China and India’s stock markets, it’s important to remember that they are not without risks. Investors should always conduct thorough research and maintain a diversified portfolio before making any investment decisions.


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