Chinese stocks are in rally mode after President Trump announced plans to delay a proposed increase in tariffs. But two market watchers warn a pullback might be coming.
The Shanghai composite posted its best day in nearly four years, and the, an ETF that tracks some of the largest China-based companies, hit its highest level since June. That ETF is outperforming U.S. stocks this year — gaining 15 percent compared with the S&P 500's 11.5 percent — but one expert is urging caution.
"China still has a number of structural issues that it has to face. Now of course it's slowing down very slowly and it continues to put out better numbers than the U.S. But the China story and the [emerging markets] story is now very overcrowded as a trade, so I would be careful there," she added. "Technically speaking we've broken not only an uptrend going back since last year, but we got above $43.50, which has held since last spring. So it's been a big breakout of late," he said.
"I do see some negatives in the near term meaning it has moved up a bit too far too quickly. Forty-six dollars is a big level. It's really a 50 percent retracement of the entire move down since last year."
Malaysia Latest News, Malaysia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Chinese Stocks Jump After U.S. Postpones Tariff IncreaseMainland Chinese shares surged on signs of easing trade tensions with the U.S. and top-level support for the country’s financial sector.
Read more »
Huawei president promises not to spy on US as Trump considers banning the company's equipmentRen, whose daughter is being held by Canada, denies U.S. allegations that the company aids Chinese intelligence by building a backdoor in its devices.
Read more »
Chinese stock markets soar on signs that the trade war with U.S. could be endingState media lauded the progress in trade talks as a “win-win.”
Read more »