Latest Search
Quote
| Back Zoom + Zoom - | ||||
|
<Research>G Sachs Expects MSCI China to Rise 20% in 2026, Southbound Net Inflow US$200B
Recommend 5 Positive 4 Negative 0 |
||||
|
||||
|
Goldman Sachs, in its research report, predicted that the MSCI China Index and the CSI 300 Index will ascend by 20% and 12% respectively this year, and maintained an Overweight rating on A- and H-shares. The broker considered this year's stock market gains will be entirely driven by earnings growth. Supported by AI, the "Going Global” strategy, and anti-involution policies, earnings growth was estimated to accelerate from 4% in 2025 to 14% in 2026 and 2027. The report also argued that current market valuations are reasonable, and that AI monetization, policy stimulus, and better-than-expected liquidity will provide upside potential. In terms of liquidity, the broker forecast that net inflows of southbound capital may reach US$200 billion (approximately HK$1.558 trillion, compared to HK$1.4 trillion in net inflows in 2025), setting an all-time high. Domestic asset reallocation flows may accelerate, potentially bringing approximately RMB3 trillion in incremental funds to the stock market. Total dividends and share buybacks this year may approach RMB4 trillion. Foreign long-term investors may reduce their selling of Chinese stocks, implying a potential purchase scale of approximately US$10 billion (approximately HK$77.9 billion). IPO fundraising this year may exceed US$100 billion (approximately HK$779 billion), up 80% YoY, equivalent to 0.5% of the current market cap. In terms of sectors, the broker stayed upbeat about the AI theme, upgrading the hardware sector to Overweight, consistent with the internet sector. Within the consumer sector, it still preferred services over goods, while focusing on the materials industry and maintaining an Overweight rating on the insurance sector. Goldman Sachs forecast China's GDP to grow by 5%, 4.8%, and 4.7% YoY in 2025, 2026, and 2027, respectively. It also projected CPI to remain flat, rise by 0.6%, and lift by 0.9% YoY in 2025, 2026, and 2027, respectively, while PPI was expected to fall by 2.6%, fall by 0.7%, and rise by 0.3% YoY in 2025, 2026, and 2027. Goldman Sachs projected the USD/CNY exchange rate to be 6.85 in 2026 and 6.54 in 2027. AAStocks Financial News |
||||
Copied to Clipboard
 |
||||
