**Chinese Stocks Set to Continue Rally After Golden Week Break**
Analysts predict that China’s stock market will maintain its upward momentum when mainland markets reopen after the Golden Week holiday. The CSI 300 blue-chip index has already seen a remarkable 25% surge in just nine days, with a record-breaking 8% jump on Monday. Despite a brief dip in Hong Kong stocks on Thursday, experts believe the rally will persist, driven by Beijing’s recent economic stimulus announcements and increased participation from retail investors.
Eugene Hsiao, Head of China Equity Strategy at Macquarie Capital, attributes the Hong Kong dip to short-term profit-taking and expects the rally to continue for an extended period. Shehzad Qazi, COO at China Beige Book International, agrees, but warns of a potential reversal in sentiment if the stimulus measures fail to deliver significant growth.
Shaun Rein, founder of China Market Research, predicts another 1-3 weeks of growth, citing the sentiment-driven rally and increasing individual investor participation. However, he also notes that volatility is likely to increase as investors try to time their exits.
Nomura’s chief China economist, Ting Lu, suggests that the rally has been fueled by fear of missing out, and that investors should exercise caution amidst the market frenzy. The Ministry of Finance’s upcoming fiscal policies and support measures will be crucial in sustaining the rally, according to experts.
While the rally could be derailed by factors such as stronger-than-expected US job numbers or a Trump victory in November, analysts believe that China’s stock market is poised for continued growth, driven by the government’s stimulus efforts and increasing investor participation.
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