Amboi, the confidence of US investors with Chinese stocks before the FOMC!


 'This action is like taking a chance first, thinking about the risk later.'

Shares of Chinese firms in the United States (US) surged a day before the FOMC meeting as news of China's easing of sanctions added to investor interest.

Looking at the Nasdaq Golden Dragon index which lists 65 Chinese firms in the US, there was a 7.6% jump which was the highest increase in more than 5 months during the New York session yesterday.

Among those who recorded an increase were Alibaba Group Holding Ltd, Pinduoduo Inc and Inc which each jumped 6.5% which is in line with the performance of the rally in the Hong Kong stock market.

The rally that took place in the shares of the Chinese firm can be traced after the announcement of measures to ease restrictions (lockdown) in the world's 2nd largest economy.

It has given positive indications to investors after the main index in the US suffered a decline to a 9-year low last week following President Xi Jinping's push to consolidate his power over the government.

In addition, investors are also hoping for the relaxation of the lockdown in China to ensure that the world's 2nd largest economic activity can continue especially if there are problems in the housing sector and the weakness of consumer spending.

However, HB Investments' head of investment, Sharif Farha, described the rally as temporary as everything is in China's hands with their zero-Covid measures.

In the meantime, the news of the easing is seen to restore a little bit of broad market sentiment when Chinese stocks in Europe also showed an increase despite investors still being cautious about the Covid policy.