China Markets Face Choppy Return From Holidays as Risks Abound

-- Chinese markets are set to reopen after the Golden Week holidays against an uncertain global market backdrop, which may temper optimism from the spending boom at home.A lot has happened overseas while mainland markets were shut. Risk assets were hammered as renewed concern about higher-for-longer US interest rates spurred a Treasuries selloff that rippled through world markets.

Traders had been pinning their hopes on a holiday consumption boost to provide new catalyst for the sluggish market. Travel and spending surged compared with lockdown-hit 2022, with 826 million travelers representing a 71% increase from last year. Spending jumping nearly 130%. Other key sets of data released during the break also showed the broader economy is on the mend, though far from roaring back.

Some investors, however, say this year’s relentless selloff has created some buying opportunities. There are also hopes that the upcoming third plenum of the 20th Party Congress, a gathering of top leaders to discuss major economic and reform issues, will offer hints of further stimulus. The meeting, to be held toward the end of October and early November, could act as a positive catalyst, said Chen of Bloomberg Intelligence.

“We have economic data showing improvement so that’s a good start, but markets are skeptical given how confidence was badly damaged,” said Christopher Wong, FX strategist at Oversea-Chinese Banking Corp. in Singapore. It will take time for Chinese markets to recover, he added, as “sentiment needs to recover and confidence needs to be repaired.”The TFSA Play: Turn $6,500 Into a Retirement Goldmine

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