Foreign investors poured a record $9bn into Chinese equities in January, the largest single-month inflow on record, betting the mainland market has bottomed out after a disastrous 2018 and anticipating that a more dovish US Federal Reserve will boost emerging markets.
A more positive outlook for US-China trade talks is also brightening sentiment, with many investors taking the view that negotiations are likely to produce at least a deal to forestall an immediate increase in tariffs.
The CSI 300 index, which tracks blue chips traded in Shanghai and Shenzhen, lost 25 per cent in 2018 but has rebounded by 9 per cent this year, including a 1.8 per cent gain on Monday when mainland markets reopened following a 10-day national holiday.