In June, global mutual funds reduced their share in Chinese markets. This capital outflow is due to several factors. First, investors are concerned about the pace of the Chinese economic recovery. Recent weak economic indicators, including slow GDP growth in the second quarter, undermine optimism. Secondly, global investors, fearing risks, have become less inclined to buy stocks, which negatively affects sentiment towards China. The active sell-off in emerging Asian markets, including China, confirms this trend. Thirdly, uncertainty about the political situation in the United States, in particular around the 2024 presidential race, creates additional anxiety. Investors fear that possible changes in Washington's policy towards Beijing could have a negative impact on the Chinese economy. The lack of clear incentive measures from the Chinese government also does not contribute to the growth of investor confidence. As a result, the Shanghai Shenzhen CSI 300 and Shanghai Composite indexes fell to five-month lows, and China took the second place in terms of outflows from emerging Asian markets over the past week, second only to Taiwan.
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