Citibank: Chinese equities to witness strong rebound on positive trade talks with US

Sandeep Kanihama FXStreet Contributor

Citibank analysts are expecting Chinese equities to rebound significantly, if Trump & Xi set aside the majority of immediate trade issues for future negotiation and develop some areas of agreement by March 1^st.

Key Quotes

“This view extends to Chinese companies focused on their domestic market as China has spent a longer period than the US gripped by fears of a slowdown. China has taken steps to strengthen its economy.”

“If further tariffs go into effect on March 1st, the Chinese Stimulus provides some cushion to its impact on their economy & lengthens the time China can negotiate.”

“Given our highest probability view that US macro policy overall will need to shift toward sustaining expansion, the likely combination of low US rates & Chinese stimulus could extend the global equity recovery after an already generous rally. A preliminary trade deal would be positive for markets and global equities could be up 5% by end-19.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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