Dear readers,
There is just about one more month left of 2019. For those who bet on China early on, it has already been a good year. President Trump’s tweets and tariffs have not stopped China’s CSI 300 index from returning 31 per cent this year. The index of major Shanghai and Shenzhen-listed stocks outperformed most global markets and benchmarks, including the US and MSCI World. Doomsayers who predicted — wrongly — a crash this year still warn of a soon-to-come reversal from trade uncertainties and an economic slowdown. They are likely to be proved wrong, once again.
One of the main drivers of the rally has been a faster and larger-than-expected addition of Chinese stocks to MSCI indices. This week the US index provider added more than 200 China mainland A-shares to the emerging market index, pushing China’s country weight to more than a third of the total.