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are japanese stock funds continuing to buy chinese assets?

hong kong stocks fluctuated sharply today, emerging from a v-shaped trend. in early trading, the hang seng index once fell by more than 4%, and the hang seng technology index once fell by more than 7%. however, hong kong stocks rose strongly in the afternoon, with the hang seng index and the hang seng technology index narrowing their losses significantly. the hang seng index once erased its losses, and the hang seng technology index's losses once narrowed to less than 1.5%. as of the close, the hang seng index fell by about 1.4%, the hang seng technology index fell by about 3.3%, and meituan, china merchants bank, etc. were in the red.

some chinese brokerage stocks strengthened in the afternoon. huatai securities once rose by more than 26%, hongye futures once rose by more than 19%, and china merchants securities once rose by more than 9%.

shengjing bank rose sharply during the session, once rising by more than 200%.

in addition, the ftse china a50 index futures traded in singapore also surged and turned red, up more than 1.5% so far.

regarding today's adjustment in hong kong stocks, zhang yidong, global chief strategist of industrial securities, said that the shock in hong kong stocks just verified the reversal logic, rather than a short-lived rebound.

yesterday, zhang yidong said in a live broadcast that the logic of china's stock market is changing. whether it is a shares or hong kong stocks, the medium-term market trend will shift from rebound logic to reversal logic. the key to this transformation lies in the directional changes in china's macroeconomic policies. he said that after september 24, there was a clear directional change in policy orientation.

zhang yidong also said in the latest strategic research report that if there are short-term shocks in the stock market in october, we should face them positively. the research report believes that, first of all, after experiencing a short-squeeze rebound at the end of september, the growth rate of china's stock market, especially hong kong stocks, in 2024 has led the world. during the rise in october, there may be disturbances such as the u.s. election and european and american stock market shocks, which may lead to short-term profit taking. secondly, in the short and medium term, we must abandon the bear market mentality and strengthen the bullish mentality. the shock in october was more about gathering momentum and rushing through the sand. the shock was to find more sustainable and reversible mainline opportunities. third, there is no limit on the market space and time in the mid-term, because the financial power is still flowing. fourth, after the recent rise in hong kong stocks, there is still room for further recovery.

in other markets, wind market data showed that on october 3, the a-share southern csi 500 index etf listed in japan closed up 62.5% at 10,400 points. on october 2, the etf rose 77.8%. on october 1, the etf rose 80.4%. since september 27, the etf has risen by more than 600% in 5 trading days.

according to information from the japan exchange group, the etf was listed on june 25, 2019. it is part of the "china-japan etf interconnection" plan and mainly tracks the csi 500 index.

in fact, recently, funds have used hong kong stock etfs, japanese etfs, and us stock etfs to buy chinese assets on a large scale.

yesterday, the science and technology innovation 50 etf listed on the hong kong stock exchange-southern science and technology innovation board 50 once soared by more than 230% during the session. although it fell back, it still closed up by more than 28%. today, the etf once rose by more than 33% after opening, and then fell back with the overall trend of hong kong stocks. it fell by more than 3% by the close.

the bosera science and technology 50 etf once soared by more than 180% today, but the closing gain fell back to about 23%. yesterday, the etf closed up by more than 106%.

in terms of u.s. stocks overnight, 3x long ftse china etf-direxion rose more than 21%, 2x long csi 300 etf-direxion rose more than 15%, 2x long ftse china 50etf-proshares rose more than 14%, china concept the internet etf-kraneshares rose more than 6%, and the chinese large-cap etf-ishares rose more than 7%.

recently, a series of policy "combination punches" have stimulated the chinese stock market to rise sharply, rekindling foreign investors' optimism about chinese assets.

morgan stanley said chinese stocks could rise a further 10% to 15% if the chinese government announces more spending measures in the coming weeks. "expectations of further fiscal expansion are back on the table, allowing investors to view china from a reflation perspective for the first time in a long time." laura wang, chief china equity strategist at morgan stanley, said in an interview shi said, "the last time investors looked at china through this lens was actually after the beginning of last year. at that time, the valuation given by global investors was about 12 times the expected price-earnings ratio of the msci china index."

however, some market analysts pointed out that some of the skyrocketing etfs are due to the fact that a-shares are not open and funds are pouring into other markets to deploy a-shares. on the other hand, the scale of these etfs is not large. for example, the a-share china southern csi 500 index etf listed in japan mentioned earlier, although it surged by more than 60% today, its total transaction volume was only 11.648 million yen (approximately rmb 557,000).