Because of a rebound in its two major stock markets and its strong economy, China is capturing the interest of international fund managers for the first time in more than two years, The Wall Street Journal reports.
Moves to remove the overhang of non-tradable shares and easing curbs on international portfolio investment in the market have piqued managers' interest in China.
According to a survey of fund managers by Dow Jones, Japan remains fund manager's favorite international pick. However, China is not far behind at second place.
Since the beginning of this year, China's Shanghai Class A share market has risen 10% and the Shenzhen Class A share market has risen by 11%. Last year, the two markets were down, by 8% and 12%, respectively.
"Liquidity in China is expected to stay robust while the strength in the economy will likely be sustained this year," said Stephen Kam, associate director at
Senior Economist at
"However, margins are being squeezed and the Chinese market is highly sensitive to energy prices and global-risk appetite, which we believe are more likely to fall than rise in the coming months," he said, adding that China is an inexpensive market in most situations.