Jan 17, 2024

The Chinese GDP will be released on Wednesday morning, and traders will hope for a rally.


China 50 – Daily Chart 

The price outlook for the China 50 index is optimistic with the upcoming data as it points to a potential low at the 10,889 support. A stronger-than-expected figure could see a push to 11,000. 

Economists expect a boost in the growth figures from 4.9% to 5.3%, which will be released at 10 am HKT. 

On Tuesday, Chinese Premier Li Qiang said the Chinese economy had bounced higher and was estimated to have grown around 5.2% in 2023, above the official target of about 5%. I was talking at the World Economic Forum in Davos, saying that the Chinese economy could handle ups and downs in its performance. 

A weaker economy in 2022 than expected caused foreign investors to pull their money in a disappointing year for the Chinese stock market. But there were recent signs of inflows, which were met by weaker data. 

A strong GDP figure to start 2024 could see investment fund inflows, leading to a more significant rally in the China 50 index. 

“Last year in 2023, the Chinese economy rebounded and moved upward with an estimated growth of around 5.2%, higher than the ‘around 5%’ target set at the beginning of last year,” Li said. 

“In promoting economic development, we did not resort to massive stimulus,” Li added. “We did not seek short-term growth while accumulating long term risk.” 

The country is considering 1 trillion yuan ($139 billion) of new debt issuance under a unique sovereign bond plan to boost the economy. Official data showed that foreign investment turned negative in the third quarter of last year for the first time since 1998, and the government will want to reverse that trend.

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