Global X China Materials ETF (CHIM)
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China has not solved the unravelling crisis in its development/construction sector. The nation has moved through all the ‘natural' stages an economy goes through when implementing the free market capitalism model.
Chinese government has generally had some idea of how much risk Evergrande and other highly leveraged real estate companies pose since last year. Equity holders will most likely be wiped out, with holders of bond and wealth management products taking significant haircuts.
The impact of the policy remedy to China's property market excesses is spreading across global markets. But they would bounce hard on any evidence of a mitigation plan from Beijing.
Shares in China continue to post sharp year-to-date losses vs. an otherwise upside bias for global stocks, based on a set of exchange-traded funds tracking the world's major equity regions through yesterday's close (Aug. 25). Some investors see opportunity in beaten-down shares, but there's still a wide-ranging debate as the market prices in higher uncertainty driven by the vagaries of Beijing's evolving policy agenda.
In the second quarter of 2021, China's economy grew at a pace of 7.9% year on year. Chinese sector dispersion in Q2 was 29.55%, versus 13.53% in the US.
Last week was moderate for Wall Street. Though multiple states in the United States have lifted COVID-19 restrictions, almost half of United States reported rising cases recently.
As the world enters the second half of 2021, look for infrastructure demand to be a key mover for the Global X MSCI China Materials ETF (CHIM). “Infrastructure relies heavily on basic materials like cement, steel, copper and more,” a Global X analysis said.
While ETF investors can opt for broad exposure to China, they can also get sector-specific exposure to home in on specific market opportunities. While go-to sectors might include technology or health care, ETF investors can impressive performance from raw materials with the Global X MSCI China Materials ETF (CHIM).
Money manager Glovista Investments, which runs a variety of emerging markets and global investment strategies, said Tuesday it's rolling out a China sector rotation model based on 11 sector exchange traded funds issued by Global X.
News updates have come a mile a minute this week on the China-US trade front, and we end the week with more tariffs and a topsy-turvy market.