As the Chinese stock market reopens after the National Day holiday, investors are keen to see if the pre-holiday rally will continue. Goldman Sachs has raised its rating on Chinese stocks to "overweight," anticipating an increase in benchmark valuations. This optimistic view stems from the Chinese government's decisive policy actions that have improved valuations.
Citigroup has also upgraded its ratings on Chinese consumer and real estate stocks. According to a report from Goldman Sachs, analysts like Tim Moe predict a potential 15% to 20% upside for Chinese stocks. This optimism is based on recent strong rebounds, valuations still being below the median range, potential earnings growth, and light positioning by investors.
Goldman Sachs has raised its 12-month target for the MSCI China Index and the CSI 300 Index to 84 points and 4600 points, respectively, corresponding to a total return rate of 15% to 18%.
Additionally, Citigroup analysts Pierre Lau and Air Ma favor internet stocks, maintaining an "overweight" stance due to strong fundamentals and the positive spillover effects from consumption stimulus measures.
