Morgan Stanley Slashes China Stock Outlook After Party Congress
- MSCI China may drop 22% in bear case, rise 48% in bull thesis
- The move creates wider bull-bear range amid uncertainty
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Morgan Stanley has slashed targets for key China equity gauges across scenarios, creating a wider dispersion between its bull and bear cases as President Xi Jinping tightens his grip over the nation’s power structure.
The US bank expects MSCI China Index to lose 22% through June 2023 in its bear case and gain 48% in its bull case, wider than its previous range as strategists “acknowledge a wide range of potential outcomes and hence divergence in earnings and in particular risk premia.”