Chinese markets are closed for the Golden Week holiday through October 8 (appropriately, just after the CSI had its biggest one-day gain since the Lehman crash following a massive Chinese stimulus), but investors can still trade Chinese equities, or at least a very close facsimile, thanks to US ETFs, which are open even if mainland China is closed.
Which is why Goldman trader Andrea Hu writes that the bank has been fielding questions on China outperforming KWEB +4% vs Nasdaq -1%. China celebrated Oct 1st national day where Xi celebrates 75th anniversary of People’s Republic of China where his speech included topics such as economic progress, Taiwan unification etc.
Notably, we have not seen any fiscal reforms come through (yet) to the extent media reported ($284bn sovereign debt as reported by Reuters / $142bn capital injection into top banks). That said, the Goldman econ team believes an additional RMB1-2 trillion ultra long-term central government special bond quota is likely. The team in a note last wk wrote that the policies announced so far could raise GDP by 40 bps.
