The article talks about President Xi Jinping’s plan to renew China’s “panda diplomacy” with the US by promising new pandas for American zoos to improve Sino-US relations. However, it also highlights the underlying issues in the US-China relationship, such as US curbs on advanced chip sales, investments in Chinese technology, and disputes in the South China Sea. The recent US-China summit yielded progress, but there was no discussion on these critical issues, leading to further tensions.
The article also discusses the poor performance of Chinese stocks, despite trading at historically low valuations. The local property sector is a major concern, with home prices falling and the real estate crisis worsening. These factors suggest that the recent rally in Chinese shares may falter, as the market is cheap for a reason.
In summary, the article emphasizes the challenges in the US-China relationship and the concerns about the Chinese stock market, particularly the property sector. Investors worried about the asset deflation threatening the property sector may find the recent rally in Chinese shares to be unsustainable.
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