Home » Business » Acceleration of Chinese stock selling, further deterioration of corporate performance – dashing hopes for stock price recovery

Acceleration of Chinese stock selling, further deterioration of corporate performance – dashing hopes for stock price recovery

Hopes for a recovery in China’s stock market are being dashed by the country’s companies’ deteriorating performance. Some investors are bracing for further damage as the economic downturn is expected to continue.

Corporate performance worsened in the July-September period (third quarter) of this year. According to Morgan Stanley, about 30% of stocks in the MSCI China index missed market expectations in the quarter, up from 18% in the previous quarter.

According to data from Bloomberg Intelligence (BI), earnings per share for all constituent stocks fell 6% from a year earlier, marking the fourth straight quarter of negative growth.

The slow recovery highlights the problems that companies still face even as the Chinese government tries to boost the economy. The worsening real estate crisis, deteriorating profit outlook, and uncertainty surrounding regulatory regulations continue to put pressure on companies.

The current slump in business performance suggests that even if the government’s stock price measures lead to an upturn in market prices, it will be short-lived unless demand fundamentally improves.

China Earnings Still in Doldrums

Source: Bloomberg Intelligence

David Chao, a strategist at Invesco Asset Management, said: “Investors’ expectations were disappointed as the results for the July-September period did not provide a positive sign for investment activity, with only a few weeks left until the end of the year. “I think it’s clear that further policy support is needed to get the Chinese economy back on track.”

2023-12-06 03:41:48
#Acceleration #Chinese #stock #selling #deterioration #corporate #performance #dashing #hopes #stock #price #recovery

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.