Are you keeping an eye on the latest financial news coming out of China? Well, get ready for a change that might impact how you track foreign flows for stocks in the country. China is set to switch off a live feed of foreign flows for stocks as early as Monday, according to a report from Bloomberg. This move is aimed at boosting investor confidence by removing a potential source of negative data.
The Shanghai and Shenzhen exchanges are planning to stop displaying real-time figures on purchases or sales of local stocks through trading links with Hong Kong. Instead, they will provide turnover details on a daily basis, along with the 10 most-traded stocks via the northbound channel. This adjustment is seen as a way to limit the impact of data showing foreign funds selling on market sentiment.
Investors, however, seem to have taken this change in stride, focusing on positive catalysts like attractive valuations and government efforts to ease a housing crisis. The rally in Chinese shares since the announcement indicates a level of confidence among investors.
“While the real-time data feed may be useful for some investors, long-term value investors understand that intraday fluctuations are often just noise,” says Chen Shi, a fund manager at Shanghai Jade Stone Investment Management Co.
In recent months, the Chinese stock market has seen a resurgence, thanks to various government interventions and signs of economic recovery. Foreign investors have also shown continued interest in the market, with northbound investors delivering a third straight month of buying on a net basis in April.
Despite geopolitical tensions that may impact foreign sentiment, the presence of global investors in China’s stock market remains relatively small. The upcoming loss of live northbound data doesn’t seem to have deterred Chinese investors, as the benchmark CSI 300 Index has risen more than 5% since the change was announced.
At Extreme Investor Network, we keep you informed about the latest developments in the financial world, including changes in foreign flows for Chinese stocks. Stay tuned for more insights and analysis to help you navigate the ever-changing landscape of global markets.