China’s Crackdown Has Made Its Stocks Cheap. But Should You Buy?
Valuations are down, but even ETF star Cathie Wood is dumping shares, showing the magnitude of concern over Beijing’s tightening regulatory grip.
Photographer: Qilai Shen/Bloomberg
It boasts the world’s second-biggest economy, millions of consumers eager to spend on fashion, gadgets and properties, and stocks that look cheap after a rout. Yet everyone seems to be fleeing Chinese financial markets.
That shows the magnitude of concern about what Beijing’s crackdown on private businesses means for overseas investors. Take superstar fund manager Cathie Wood, for example. Just two weeks ago, she said that Chinese stock valuations are low and are likely to continue staying down. Still, she’s selling shares of companies including tech giant Tencent Holdings Ltd., property site KE Holdings Inc. and Alibaba Group Holding Ltd.