Bonds That Were Ground Zero for China Debt Woes Now Top Pick

Investors recommend buying more LGFV notes in 2019: survey
Stepped-up stimulus measures boost demand for such bonds

This photo taken on November 25, 2018 shows a cyclist riding in a sandstorm in Zhangye, in China's northwestern Gansu province. - A northwest Chinese city was engulfed by a massive sandstorm that sparked rural fires, forced traffic to slow down and prompted residents to cover their faces, according to state media. (Photo by - / AFP) / China OUT (Photo credit should read -/AFP/Getty Images)Photographer: -/AFP

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By Bloomberg News

January 15, 2019 at 10:30 PM UTC

Updated on

January 16, 2019 at 9:44 AM UTC

This article is for subscribers only.

China’s stimulus measures are seen easing financial stress at the nation’s debt-laden town builders, making them among the top picks for investors this year, a Bloomberg survey showed.

Some 15 out of 20 analysts and portfolio managers recommend adding more bonds of local government funding vehicles to their portfolios in 2019, according to the survey done in recent weeks. After Chinese government bonds, LGFVs are the most sought after by respondents in the survey, followed by convertible notes.