As global investors pull money from South Korea, top domestic brokerages expect strong domestic fundamentals to drive fresh buying in China
Leading Chinese brokerages have expressed optimism for domestic tech shares traded in August, distinguishing them from the sharp sell-off that has rattled South Korean financial markets.
Citic Securitiessaid it believed mainland-traded shares – also known as A shares – had only undergone a correction after investors piled into artificial intelligence-related sectors, rather than suffering the deleveraging shock seen in South Korea.
“The liquidity pressure in some industries remains, but the impact on some noncore AI shares has now largely subsided,” the country’s second-largest brokerage by total assets said in a note.
a sell-off in semiconductor sharesin July, as investors rushed to lock in profits following a strong surge in chip stocks.
Despite a rally over the last few days, the memory chip-heavy Korea Composite Stock Price Index (Kospi) suffered a 22 per cent monthly loss, its steepest decline since the global financial crisis. China’s CSI 300 Index also posted a 7.9 per cent fall, while the S&P 500 Index in the United States slipped 0.1 per cent, its worst July performance since 2014.
In Asian trading on Monday, Kospi fell over 5 per cent, while the mainland’s CSI 300 slid 0.98 per cent and Hong Kong’s Hang Seng Index inched up 0.48 per cent.