China International Capital Corporation: During the National Day holiday, active foreign capital has turned into inflows. Subsequent developments are worth paying attention to.
China International Capital Corporation released a research report stating that during the holiday period, Hong Kong stocks and Chinese concept stocks continued to soar, passive foreign capital accelerated inflow, but the proportion of existing stock is not large. There is a certain amount of overdraw in tradable funds, and active foreign capital has turned into inflows, but the scale is not significant yet. The subsequent movements of active foreign capital are worth monitoring, however, their sustained inflow requires more policy support and more optimistic expectations driving it. Specifically, active foreign capital has turned into inflows, but the scale is not significant. Active foreign capital accounts for 80%, much higher than passive funds, therefore, it is more important and representative of long-term institutional investors. This week, overseas active funds turned into inflows of $0.19 billion in A shares, inflows of $0.12 billion in Hong Kong stocks and ADR. Although the scale is not large, it is the first time it has turned into net inflows after 65 consecutive weeks of outflows since the end of June 2023. Regionally, the main focus is on funds investing in China and the Asian region, while funds investing in emerging markets and global funds have not yet flowed in. This is possibly due to the speculation that some active funds, as the market continues to rise significantly, are forced to reduce underweighting to avoid falling behind too much. The subsequent movements of active foreign capital are worth monitoring, however, their sustained inflow needs more policy support and more optimistic expectations driving it.