In contrast to the global stock market's robust performance in 2023, marking the best year since before the pandemic, investors have exhibited caution towards China, according to a media report. Several challenges, including a real estate crisis, sluggish consumer spending, and high youth unemployment, have created headwinds for the world's second-largest economy.
China's CSI 300 index experienced a decline of over 11% during the year, while Hong Kong's Hang Seng saw a nearly 14% drop. In comparison, the MSCI World index is set to conclude the year with a 22% increase, marking its most significant annual jump since 2019.
Major global indices have demonstrated positive momentum throughout the year. The US benchmark S&P 500 is on track to finish the year with nearly a 25% gain, Europe's Stoxx 600 is poised for a 13% increase, Japan's Nikkei 225 has surged by 30%, and India's Sensex has climbed nearly 19%.
The resurgence in stock markets can be attributed to falling inflation, fostering hopes that central banks worldwide will consider interest rate cuts. Additionally, enthusiasm surrounding the potential of artificial intelligence to drive substantial returns for companies has contributed to the positive market sentiment.
India has particularly benefited from optimistic bets on its economy, while Japanese stocks have gained from relatively inexpensive valuations and a weakening currency. However, China's economic performance has not demonstrated the anticipated strong rebound, despite the relaxation of strict coronavirus lockdowns in late 2022.
(With Agency Inputs)
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