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The fund generally will invest at least 90% of its assets in the component securities of the underlying index and in investments that have economic characteristics that are substantially identical to the component securities of the underlying index. The index is a free float-adjusted market capitalization-weighted index designed to measure the performance of equity securities in the top 85% in market capitalization of the Chinese equity securities markets, as represented by the H-shares and B-shares markets. The fund is non-diversified.

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Descubre cómo las acciones chinas repuntaron en 2024, los ETF más destacados y lo que depara el futuro económico de China en 2025.

Acciones chinas: Recuperación, ETF destacados y perspectivas

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As China's tech sector stages a strong comeback, investors are increasingly looking at <a href="https://www.benzinga.com/etfs">ETFs as a way to gain exposure</a> to this space. 
Whether it's internet giants, broad technology firms, or a mix of leading Chinese companies, ETFs offer a diversified way to take a bite of surrounding China's innovation boom.
Here are three ETFs that provide investors with access to China's rebounding tech sector.
Also Read: <a href="https://www.benzinga.com/news/global/25/01/43315374/ai-etfs-in-focus-as-alibaba-challenges-deepseek-with-new-model">AI ETFs In Focus As Alibaba Challenges DeepSeek With New Model</a>
<ul>
<li>Invesco China Technology ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CQQQ#NYSE">CQQQ</a>): This ETF provides concentrated exposure to China's tech giants. It also mirrors the FTSE China Incl A 25% Technology Capped Index, which includes major players like Tencent (OTC:<a class="ticker" href="https://www.benzinga.com/stock/TCEHY#OTC">TCEHY</a>), PDD Holdings (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PDD#NASDAQ">PDD</a>), and Baidu (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/BIDU#NASDAQ">BIDU</a>), companies at the forefront of AI, e-commerce, and cloud computing. Recently, Baidu Cloud and Tencent Cloud integrated DeepSeek&#8217;s AI model into their platforms. With DeepSeek's upward rise, both companies witnessed a surge, and pulled CQQQ up along with it. The ETF has rallied 13.5% year-to-date and 45% in the past year.</li>
</ul>
<ul>
<li>KraneShares CSI China Internet ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KWEB#NYSE">KWEB</a>): This ETF provides exposure to China's big internet names, mirroring the CSI Overseas China Internet Index. The fund&#8217;s holdings include major players like Alibaba (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BABA#NYSE">BABA</a>), Tencent, and Baidu. Alibaba's latest AI model has <a href="https://www.benzinga.com/25/01/43311376/alibaba-unveils-qwen25-max-claims-it-beats-deepseek-and-openai-in-ai-performance-race">reportedly outperformed</a> Meta Platforms (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/META#NASDAQ">META</a>) Llama and DeepSeek's V3 in various tests. This led the company's stock to surge, lifting KWEB along with it. As Wall Street brokers turn more optimistic on China's valuation discount disappearing, KWEB stands to benefit from increased foreign inflows. The ETF has grown 12.6% year-to-date and 32.5% in the past year.</li>
</ul>
<ul>
<li>iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>): This ETF provides a broader exposure while maintaining access to substantial allocation to technology stocks. China's largest and most liquid companies, including Tencent, Alibaba, Meituan and Xiaomi are among MCHI&#8217;s holdings. HSBC recently noted that the valuation gap between China and emerging markets may narrow as global funds flow into Chinese stocks. Deutsche Bank echoed the sentiment.</li>
</ul>
<h3 class="wp-block-heading">Market Overview</h3>
The Hang Seng Tech Index is currently trading at 17 times forward earnings estimates, significantly cheaper than the Nasdaq 100's 27 times valuation, according data compiled by Bloomberg. This suggests ample room for price appreciation, making MCHI an appealing option. The ETF has climbed 8.32% this year thus far, and 31.25% in the past 12 months.
After years of regulatory headwinds and economic uncertainty, China's tech sector is making a roaring comeback. A surge in AI innovation and favorable valuations have propelled the Hang Seng Tech Index into a bull market, with Wall Street analysts increasingly bullish on the space, said Bloomberg in a report. Heavyweights like Xiaomi and Alibaba are among the companies leading the rally.
Meanwhile, Bloomberg reported that analysts at Deutsche Bank argue that China's innovation-driven resurgence will force global investors to turn sharply toward the nation's stocks, despite geopolitical risks.
Favorable valuations have helped reinforce the upbeat sentiment. As Deutsche Bank's Peter Milliken put it in a research note: "We think 2025 is the year the investing world realizes China is outcompeting the rest of the world." 
Read Next: 
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<li><a href="https://www.benzinga.com/25/02/43565442/exclusive-defiance-ceo-talks-about-the-new-orcx-etf-launch-and-all-things-ai">EXCLUSIVE: Defiance CEO Talks About The New ORCX ETF Launch And All Things AI</a></li>
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CQQQ

KWEB

China Tech ETFs Surge As DeepSeek-Led AI Boom Fuels Bull Market

President Donald Trump's announced tariffs on Canada, Mexico and China could impact many sectors and see retailers and companies raising prices on consumers to offset<a href="https://www.benzinga.com/markets/25/02/43423288/trumps-tariffs-are-here-heres-what-will-get-more-expensive-from-canada-china-and-mexico"> the higher prices.</a>
Here's a look at the sectors and stocks that could be hurt the most by Trump's tariffs and retaliatory efforts by the three countries back on the U.S.
What Happened: Trump <a href="https://www.benzinga.com/government/regulations/25/02/43427091/as-trump-imposes-tariffs-on-americas-3-largest-trading-partners-this-macro-strategist-call">announced 25% tariffs </a>on imports from Canada and Mexico along with a 10% tariffs on items imported from China. Trump and Mexican President Claudia Sheinbaum announced Monday the U.S. tariffs on Mexico have been paused for one month. 
Canada fought back with retaliatory measures on U.S. imports.
Trump said he spoke with Canadian Prime Minister Justin Trudeau and plans to speak to the leader again at 3 p.m. ET Monday.
The tariffs were met with anger in Canada where sports fans booed the playing of &#8220;The Star-Spangled Banner,&#8221; the U.S. national anthem, at NBA and NHL sporting events over the weekend, as reported by <a href="https://deadline.com/2025/02/u-s-national-anthem-booed-nhl-nba-games-canada-tariffs-1236276207/">Deadline</a>.
NBA and NHL games involving teams from both countries typically play national anthems ahead of games.
Goods and Sectors Impacted: Here's a look at the top imports from Canada, Mexico and China that will be impacted if the tariffs stick.
Beer and Spirits: One of the companies that <a href="https://www.benzinga.com/news/global/24/11/42220682/trump-tariffs-on-mexico-could-affect-beer-why-your-modelo-corona-could-cost-more-next-year">could be hit hardest</a> by the tariff news is Constellation Brands Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/STZ#NYSE">STZ</a>), an alcohol company that holds the exclusive U.S. license for several of the top imported beer brands in America. Constellation imports brands like Modelo, Corona and Pacifico from Mexico, where they are brewed by Grupo Modelo, which is a unit of Anheuser-Busch InBev (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BUD#NYSE">BUD</a>).
Modelo is the top imported beer in the U.S., with Corona ranking second. Heineken and Dos Equis XX, which are imported by Heineken USA, a unit of Heineken NV (OTC:<a class="ticker" href="https://www.benzinga.com/stock/HEINY#OTC">HEINY</a>), ranked third and fourth on the list of top imported beers. Dos Equis is manufactured in Mexico and imported to the U.S.
Constellation stock is down around 40% since it was flagged as a company to see pressure from tariffs back in November.
The U.S. is also a large importer of tequila, a sector that could be hit hard by tariffs on Mexico.
Read Also: <a href="https://www.benzinga.com/trading-ideas/24/12/42536470/costco-warns-that-tariffs-raise-prices-trump-team-says-trade-policies-will-make-life-affordable">Costco Warns That Tariffs Raise Prices, Trump Team Says Trade Policies Will &#8216;Make Life Affordable&#8217;</a>
Automotive: Several automotive companies like Ford Motor Co (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/F#NYSE">F</a>), General Motors Co (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/GM#NYSE">GM</a>) and Honda Motor Co Ltd (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HMC#NYSE">HMC</a>) <a href="https://www.benzinga.com/government/regulations/24/12/42688941/are-us-vehicles-under-30000-a-thing-of-the-past-trumps-mexico-tariff-plans-could-change-auto-market">have sub-$30,000 vehicles</a> that are partially or fully built in Mexico and Canada. Tariffs on these countries could quickly make these sub-$30,000 vehicles cost more for consumers and eliminate options in the popular starting price point.
Avocados: American imports over 80% of its avocados from Mexico, which could lead to higher prices ahead of Super Bowl Sunday on Feb. 9, as <a href="https://nypost.com/2025/02/02/us-news/whats-going-to-get-hit-by-trumps-tariffs-avocados-modelo-and-iphones/">reported </a>by the New York Post. Stocks that could be impacted by higher avocado costs are Mission Produce Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AVO#NASDAQ">AVO</a>), Calavo Growers, Inc. (NASDDAQ: CVGW) and Limoneira Co (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/LMNR#NASDAQ">LMNR</a>).
Fruits and Vegetables: Canada is the largest supplier of cherry tomatoes for the U.S., which could see higher produce costs for consumers and restaurants.
Smartphones: China is one of the largest exporters of smartphones to the U.S., accounting for an estimated 87% of production according to the report. The iPhone from Apple Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AAPL#NASDAQ">AAPL</a>) has 95% of production assembled in China as of 2023.
Toys: The Toy Association industry group estimates that 75% of all imported toys come from China, making the sector one area that could be significantly hit by higher tariffs. Hasbro Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/HAS#NASDAQ">HAS</a>) and Mattel Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MAT#NASDAQ">MAT</a>) are two stocks that could see pressure with the tariffs impacting one of their key sectors. &nbsp;
Clothing: Imported clothes from e-commerce companies including Shein and PDD Holdings &#8211; ADR (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PDD#NASDAQ">PDD</a>) brand Temu will see higher prices with the tariff on China. Canadian clothing companies Aritzia and Lululemon Athletica (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/LULU#NASDAQ">LULU</a>) will also be impacted by the tariff news. 
The footwear portion of the clothing sector could see the biggest impact with the Footwear Distributors &amp; Retailers of America estimating that 99% of shoes sold in the U.S. are imported. Nike Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/NKE#NYSE">NKE</a>) could be among the companies hit hardest by the tariff news.
Construction: The American Iron and Steel Institute estimates that 25% of American steel comes from Canada and 12% comes from Mexico, which means steel prices could go up. Canadian lumber is also a large export to the U.S., which makes up around 30% of all lumber the country uses. Other construction items like drywall, lime and gypsum come from Mexico, which will put more pressure on homebuilders. The tariffs could lead to home prices going up and putting further pressure on the sector.
Oil: The U.S. is a large importer<a href="https://www.benzinga.com/news/global/24/12/42300450/trump-told-trudeau-canada-could-avoid-tariffs-by-becoming-51st-state-a-look-at-sectors-trade-war-could-impact"> of Canadian oil.</a> While oil will only see a 10% tariff compared to the 25% on other Canadian goods, the sector could likely see a large impact. Companies like Suncor Energy Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SU#NYSE">SU</a>), Enbridge (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ENB#NYSE">ENB</a>), Canadian Natural Resources (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CNQ#NYSE">CNQ</a>) and TC Pipelines (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TRP#NYSE">TRP</a>)&nbsp;could face significant impacts from the tariffs and a potential blow to the sector.
Transportation: Railway company Canadian Pacific Kansas City Limited (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CP#NYSE">CP</a>) and trucking companies Old Dominion Freight Line (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/ODFL#NASDAQ">ODFL</a>) and Knight-Swift Transportation Holdings (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KNX#NYSE">KNX</a>) could be impacted by the tariffs and negative impact on trade between the United States and Canada.
Retailers: Dollar stores and discount retailers like Dollar Tree (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/DLTR#NASDAQ">DLTR</a>) could be<a href="https://www.benzinga.com/news/global/24/12/42402629/trump-to-change-dollar-stores-for-good-dollar-tree-exec-says-prepared-to-act"> impacted by the tariffs.</a> Executives warned of the potential impact in late 2024 with the goal of offsetting the higher prices with new product sizes and negotiating lower costs with suppliers. The company also said it would consider stopping the sale of several items due to the planned tariffs.
Price Actions on Monday at publication: The iShares MSCI Canada Index Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/EWC#NYSE">EWC</a>) is down 1.46% to $40.62.
The iShares MSCI Mexico ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/EWW#NYSE">EWW</a>) is up 2.12% to $50.02.
The iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>) is down 0.29% to $48.27.
Read Next: 
<ul>
<li><a href="https://www.benzinga.com/25/02/43430259/miners-plead-for-collaboration-as-trade-wars-threaten-critical-mineral-supply-chains">Miners Plead For Collaboration As Trade Wars Threaten Critical Mineral Supply Chains</a></li>
</ul>
Photo: Visuals6x via Shutterstock

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ODFL

Why Beer, Tequila, Avocados, Cars, iPhone Prices Could Rise: Trump's Tariffs On Canada, Mexico, China To Hurt Several Sectors

Later adapted as a film, &#8220;The Big Short,&#8221; Michael Lewis&#8216; seminal book about the hedge funds that shorted the U.S. housing market before its eventual crash in 2008, shot several Wall Street pros to stardom. Among them were Porter Collins, Steve Eisman, Vincent Daniel and Danny Moses, who shorted mortgage-backed debt at FrontPoint Partners.
While the four made a killing from a short position in 2008, the Big Short alums are now focused more on going long. The traders reunited this week at an alternative investments conference in Miami, <a href="https://www.bloomberg.com/news/articles/2025-01-30/-big-short-traders-reuniting-for-hedge-fund-week-are-going-long">according</a> to Bloomberg.
Collins, co-founder of Seawolf Capital LLC, said on the panel that he has continued his spirit of contrarianism by investing in Asian markets, where valuations are currently cheaper. Daniel holds similar sentiments, but his rationale is the expectation that the U.S. Dollar will weaken, which would benefit foreign assets.
Michael Burry, the founder of the hedge fund Scion Capital, was also featured prominently in the book and portrayed by Christian Bale in the film. Burry has also been bullish on China for several quarters — per his latest 13f filing, Scion Capital&#8217;s largest position is Alibaba Group Holding Ltd &#8211; ADR (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BABA#NYSE">BABA</a>).
The iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>) tracks Chinese equities, which have traded cheaper than U.S. stocks for several years.
Moses is also looking at value in the market. The frequent CNBC guest likes gold, as reflected in the SPDR Gold Trust (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/GLD#NYSE">GLD</a>).
Eisman, a University of Pennsylvania alum, touted homebuilder stocks given the shortage of new homes in the U.S. and anticipated easing of Federal Reserve monetary policy.
Also Read:
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<li><a href="https://www.benzinga.com/markets/cryptocurrency/25/01/43350879/sam-bankman-frieds-parents-seek-presidential-pardon-from-trump">Sam Bankman-Fried&#8217;s Parents Seek Presidential Pardon From Donald Trump</a></li>
</ul>
Image: Shutterstock

Equities

Markets

'The Big Short' Goes Long: Men Who Predicted Housing Bubble Prefer Asian Stocks, Gold

President-elect Donald Trump has made tariffs one of the most talked about items ahead of his inauguration on Jan. 20. So far, he has not backed down from plans to place or increase tariffs on <a href="https://www.benzinga.com/topic/tariffs">various trade partners</a>, including Canada, Mexico and China.
What Happened: On Tuesday, Trump took things a step further by naming a new agency tasked with overseeing tariffs.
"For far too long, we have relied on taxing our Great People using the Internal Revenue Service (IRS). Though soft and pathetically weak Trade agreements, the American Economy has delivered growth and prosperity to the World, while taxing ourselves," Trump <a href="https://truthsocial.com/@realDonaldTrump/posts/113827650534234057">said </a>in a post on Truth Social. "I am today announcing that I will create the EXTERNAL REVENUE SERVICE to collect our Tariffs, Duties and all Revenue that come from Foreign sources."
Trump intends for Jan. 20 — inauguration day — to be the birthdate for the so-called &#8220;External Revenue Service.&#8221; Normally, a new law would need to be passed first to create a new bureau or statutory body.
"We will begin charging those that make money off of us with Trade, and they will start paying, FINALLY, their fair share,&#8221; Trump added. 
It&#8217;s worth noting that the U.S. Customs and Border Protection (CBP), under the Department of Homeland Security, already oversees tariffs and revenue from foreign countries. Its key functions include collecting customs duties and tariffs. The CBP also enforces trade laws and ensures revenue accountability as one of the federal government's largest revenue collectors.
Meanwhile, Democratic lawmakers are already scrutinizing Trump&#8217;s External Revenue Service plan. "No amount of silly rebranding will hide the fact that Trump is planning a multi-trillion-dollar tax hike on American families and small businesses to pay for another round of tax handouts to the rich," Oregon Sen. Ron Wyden, the top Democrat on the Senate Finance Committee, <a href="https://www.finance.senate.gov/chairmans-news/wyden-statement-on-trumps-so-called-external-revenue-service">said</a> in a statement.
Did You Know?
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<li>Congress Is Making Huge Investments. <a href="https://www.benzinga.com/gov-trades/?utm_source=BZprocontent011425">Get Tips On What They Bought And Sold Ahead Of The 2024 Election With Our Easy-to-Use Tool</a></li>
</ul>
Why It's Important: Trump's plans to place tariffs on three of the country's largest trade partners have led to many question marks on how the other countries will respond and if items will get more expensive for American consumers as a trade off.
<a href="https://www.benzinga.com/trading-ideas/24/12/42536470/costco-warns-that-tariffs-raise-prices-trump-team-says-trade-policies-will-make-life-affordable">Retail executives</a> Costco Wholesale (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/COST#NASDAQ">COST</a>) and Dollar Tree (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/DLTR#NASDAQ">DLTR</a>) have already warned about tariffs on earnings calls. Tariffs <a href="https://www.benzinga.com/news/global/24/12/42402629/trump-to-change-dollar-stores-for-good-dollar-tree-exec-says-prepared-to-act">could mean higher prices</a> for consumers, less product assortment or a change to product sizes, they say.
Trump joked that Canada <a href="https://www.benzinga.com/news/global/24/12/42300450/trump-told-trudeau-canada-could-avoid-tariffs-by-becoming-51st-state-a-look-at-sectors-trade-war-could-impact">could become the</a> 51st state of America to avoid tariffs. While the country <a href="https://apnews.com/article/canada-trump-chretien-51st-state-ad9749047d0b627eed56be22f43ea7cd">isn't ready</a> to do that, a new report signals the country could be working on avoiding the tariffs.
Canadian ambassador Kirsten Hillman said Canada is prepared to buy more items from the U.S., as <a href="https://apnews.com/article/canada-ambassador-us-trump-hillman-9ced5ba12cd6526a2bbb4a810fa9af18">reported </a>by the Associated Press. The move would ensure that there is not a deficit for America in its trade with Canada.
Hillman warned that a plan to put tariffs on all Canadian products will lead to prices going up for Americans.
"And at a time when the cost of living is challenging, when food prices are high, it seems like the wrong direction to go in," Hillman said.
Top items exported from Canada to the U.S. include oil, gas and automotive parts. These industries could see higher-priced goods under Trump's tariff plan.
Large Canadian oil companies Suncor Energy (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SU#NYSE">SU</a>), Enbridge (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ENB#NYSE">ENB</a>), Canadian Natural Resources (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CNQ#NYSE">CNQ</a>) and TC Energy (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TRP#NYSE">TRP</a>) could face significant impacts from the tariffs and a potential blow to the sector.
Railway company Canadian Pacific Kansas City Limited (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CP#NYSE">CP</a>) and trucking companies Old Dominion Freight Line (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/ODFL#NASDAQ">ODFL</a>) and Knight-Swift Transportation Holdings (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KNX#NYSE">KNX</a>) could also be impacted by the tariffs and the negative impact on trade between the United States and Canada.
Mexican President Claudia Sheinbaum has recently shown a serious focus on migration and security, two of Trump's vocal demands to keep the U.S. from placing tariffs on the country, as reported by Reuters.
Sheinbaum has <a href="https://www.benzinga.com/markets/cannabis/25/01/42895985/trump-and-mexican-president-sheinbaum-spirited-clash-over-territorial-renaming-tariffs-and-cartels">publicly sparred with Trump</a>, but it remains to be seen if she will be able to avoid tariffs for Mexico.
Ford Motor Company (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/F#NYSE">F</a>), General Motors Company (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/GM#NYSE">GM</a>) and Honda Motor Company (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HMC#NYSE">HMC</a>) are among the automotive companies that <a href="https://www.benzinga.com/government/regulations/24/12/42688941/are-us-vehicles-under-30000-a-thing-of-the-past-trumps-mexico-tariff-plans-could-change-auto-market">have sub-$30,000 vehicles </a>that are partially or fully built in Mexico and Canada.
Higher tariffs on China could rattle the American economy as the country remains a major source of many exported goods. To get ahead of potential tariff increases, China saw its exports up 10.7% in the month of December, NPR <a href="https://www.npr.org/2025/01/13/nx-s1-5258024/china-exports-us-tariffs">reported</a>.
The growth was higher than estimates of 7% and could show that companies and China are taking proactive approaches to get ahead of higher-costing goods.
ETF Price Action: The iShares MSCI Canada ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/EWC#NYSE">EWC</a>) is up 0.3% to $39.94 on Tuesday. The ETF is up 11% over the last year and down 4.5% over the last month.
The iShares MSCI Mexico ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/EWW#NYSE">EWW</a>) is up 1.5% to $48.15 on Tuesday. The ETF is down 25.3% over the last year and down 6.4% over the last month.
The iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>) is up 2.3% to $44.89 on Tuesday. The ETF is up 19.2% over the last year and down 5.5% over the last month.
Read Next: 
<ul>
<li><a href="https://www.benzinga.com/news/global/24/11/42220682/trump-tariffs-on-mexico-could-affect-beer-why-your-modelo-corona-could-cost-more-next-year">Trump Tariffs On Mexico Could Affect Beer: Why Your Modelo, Corona Could Cost More Next Year</a></li>
</ul>
Image: Shutterstock

Specialty ETFs

COST

Trump Wants Trade Partners To 'Start Paying,' Plans External Revenue Service To Oversee Tariffs

Just a few days ago, markets were encouraged by the <a href="https://www.benzinga.com/25/01/42789867/chinese-stocks-end-2024-in-green-after-a-3-year-retreat-franklin-ftse-china-etf-ishares-msci-china-etf-and-more-i">rebound in Chinese stocks</a> in 2024, after a three-year losing streak. However, a cloud of uncertainty looms over Chinese stocks and ETFs with exposure to them.
The Biden administration's call to blacklist two more Chinese tech giants—Tencent Holdings and Contemporary Amperex Technology (CATL)—has sent shockwaves through global markets, as investors anticipate its impact on the already precarious <a href="https://www.benzinga.com/topic/china">U.S.-China economic ties</a>.
Tencent, the world's largest gaming publisher, and CATL saw their shares plunge on Jan. 6.
Also Read: <a href="https://www.benzinga.com/news/legal/25/01/42865752/tesla-supplier-catl-riot-games-owner-tencent-plan-legal-action-over-pentagon-blacklist-deny-military-ties">Tesla Supplier CATL, Riot Games Owner Tencent Plan Legal Action Over Pentagon Blacklist, Deny Military Ties</a>
Notable ETFs feeling the heat of being on high alert include iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>), which allocates the biggest chunk of its holdings (15.40%) to Tencent. The net asset value inched down 1% on Jan. 7.
SPDR S&amp;P China ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/GXC#NYSE">GXC</a>): Known for its diversified holdings, this fund also allocates 11.42%, its largest for a single security, to Tencent. Other major Chinese firms like Alibaba (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BABA#NYSE">BABA</a>) and Meituan also hold key spots in the portfolio.
Invesco China Technology ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CQQQ#NYSE">CQQQ</a>), which dedicates 100% of its assets to Chinese technology stocks, is particularly sensitive to geopolitical developments. Moreover, Tencent takes up 10.76% of the total assets.
Additionally, ETFs with heavy exposure to Tesla stock, like the Simplify Volt TSLA Revolution ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TESL#NYSE">TESL</a>) has also come in the line of fire, as CATL is a key battery supplier to the EV maker.
The move to add Tencent and CATL to a growing roster of &#8220;Chinese military companies&#8221; was part of the U.S.'s counteractive effort to China's military and industrial ambitions. While the designation doesn&#8217;t impose immediate sanctions, it discourages U.S. firms from doing business with these entities, <a href="https://www.bloomberg.com/news/articles/2025-01-07/us-blacklist-of-china-s-tech-giants-risks-even-faster-decoupling?srnd=homepage-asia&amp;sref=TBDibEcD">notes </a>Bloomberg, a sentiment that trickles down into investor psyche as well.
The blacklist now includes 134 Chinese companies, four of which happen to be China's top 20 by market capitalization, collectively valued at nearly $1 trillion.
ETF investors are now closely watching developments as funds with direct or indirect exposure to Chinese companies may face increased volatility.
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</ul>
Photo: Shutterstock

Sector ETFs

ASHS

TESL

China-Focused ETFs Face Uncertainty As US Blacklists Tencent, CATL

In 2024, Chinese stocks finally rebounded from challenges like the pandemic, property market struggles, and weak consumer confidence, ditching a three-year losing streak despite a slight dip on the <a href="https://www.benzinga.com/topic/china">final trading day. </a>
The CSI 300, which tracks major companies in Shanghai and Shenzhen, climbed 14.7% last year, while the Shanghai Composite Index gained 12.8%.
In Hong Kong, the Hang Seng Index jumped 17.7% for the year, clocking its first annual gain in five years. Analysts at Value Partners, as reported by Reuters, attributed the rally to stronger-than-expected policy support from Chinese authorities, including interest rate cuts, property incentives, and funding programs to boost stock buying.
Banking stocks stood out as top performers in China, increasing 34.7%, with the biggest state banks soaring to multi-year highs. The chip sector&#8217;s growth is also worth mentioning, moving 53.9% northward as investors leaned into domestic semiconductor firms amid U.S. restrictions.
Interestingly, according to Reuters, strategists suggest that the market is nearing the end of &#8220;policy expectation-driven&#8221; trading, with optimism about continued dividends in 2025 despite potential disruptions from U.S. political changes. 
Also, taking into consideration what China President Xi Jinping said in his annual new year&#8217;s eve speech, China's GDP is likely to grow <a href="https://www.bloomberg.com/news/articles/2024-12-31/xi-says-china-s-2024-gdp-growth-expected-to-be-around-5?srnd=homepage-asia" target="_blank" rel="noreferrer noopener">around 5%</a> in 2024, meaning it is set to meet its official target. Jinping also mentioned continued economic support measures and more proactive macroeconomic policies for 2025.
Now that we have briefly examined what China&#8217;s future holds, let&#8217;s look at how some Chinese stock-focused ETFs are poised to perform.
See Also: <a href="https://www.benzinga.com/news/global/25/01/42772220/us-global-launches-technology-and-aerospace-defense-etf-why-its-allocation-makes-sense">US Global Launches Technology And Aerospace &amp; Defense ETF: Why Its Allocation Makes Sense</a>
Franklin FTSE China ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FLCH#NYSE">FLCH</a>) is an underdog among China-focused ETFs, with $145.27 million in assets under management. According to Franklin Templeton, FLCH "provides access to the Chinese stock market, allowing investors to precisely gain exposure to China at a low cost," with targeted exposure to large- and mid-sized companies in China. 
The low 0.19% expense ratio is a relief for investors outside China, as investing in Chinese stocks is expensive. Tencent Holdings (OTC:<a class="ticker" href="https://www.benzinga.com/stock/TCEHY#OTC">TCEHY</a>) holds the biggest piece of the holdings pie, with 14.38% allocation, followed by Alibaba Group Holdings (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BABA#NYSE">BABA</a>). The fund has generated 15.03% returns in 2024.
iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>) has around $5.4 billion in AUM, a much bigger ETF than FLCH in volume, with an expense ratio of 0.59%. Despite the expense ratio being on the higher side, the fund has grown 21.11% in 2024, reflecting positive demand among investors. Coincidentally, this ETF also allocates the biggest chunk of its holdings (16.59%) to Tencent, and the second largest piece (8.13%) to Alibaba.
iShares China Large-Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FXI#NYSE">FXI</a>), as the name suggests, focuses on Chinese blue-chip stocks, and has an AUM of $7.1 billion. The high-end expense ratio of 0.74% did not deter investors from rushing into the fund, pushing the price up by 23.31% through 2024. The fund provides exposure to 50 of the largest Chinese stocks in a single portfolio, offering broad coverage of major companies.
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Photo: Shutterstock

Chinese Stocks Rebound In 2024 After 3-Year Slump: 3 ETFs To Watch

China may be playing its <a href="https://www.benzinga.com/topic/china">biggest economic card yet. </a>
According to sources cited by Reuters this week, Chinese policymakers are considering allowing the yuan to weaken significantly in 2025 to counter the economic impact of a potential 60% tariff on Chinese imports by the United States. 
This move would mark a major shift in Beijing's currency strategy as the country grapples with mounting economic pressures.
But will it actually work? 
<h3 class="wp-block-heading">A Weaker Yuan: A Double-Edged Sword?</h3>
President-elect Donald Trump's proposed tariffs—10% on all imports and a massive 60% on Chinese goods—have prompted Beijing to consider devaluation as a buffer. A weaker yuan could theoretically make Chinese exports cheaper and offset the sting of U.S. tariffs.
Yet, Beijing is walking a tightrope. 
According to Lynn Song, an analyst at ING, the People's Bank of China is expected to &#8220;mount a strong defense&#8221; of the yuan. The central bank is acutely aware that if the renminbi falls too sharply, it could trigger even harsher retaliatory measures from Washington.
In response to the rumors, Financial News, a PBOC-affiliated publication, insisted the yuan remains on solid footing and predicted the currency could stabilize and strengthen by the end of the year.
<h3 class="wp-block-heading">China's Real Problem: A Balance Sheet Recession</h3>
Tariffs aren't China's only problem. 
The country is facing a multi-front economic battle, with a housing market that's imploding, a weak stock market, and slowing consumer activity.
"The gentle de-leveraging of the housing market that policymakers had in mind turned into a vicious balance sheet recession," said Alfonso Peccatiello, chief investing officer at Palinuro Capital and founder of The Macro Compass. 
"Trillions in wealth tied to real estate have been wiped out since 2021."
A balance sheet recession is brutal. In this scenario, consumers and businesses prioritize repairing their finances over spending or investing, rendering typical monetary policy tools like interest rate cuts or currency devaluation largely ineffective.
This type of economic slowdown recalls the eurozone debt crisis of 2011-2012, when fiscal austerity measures rendered monetary policy largely ineffective in stimulating the real economy.
<h3 class="wp-block-heading">Beijing's Response So Far</h3>
China&#8217;s policy response thus far has lacked courage, to say the least. 
Authorities have floated mentions of small-scale fiscal stimulus, though these efforts lack the size and scope to move the needle. 
The government has also set up mechanisms to deter investors from shorting Chinese stocks, aiming to stabilize markets. Additionally, the central bank has slashed interest rates aggressively to boost liquidity. 
Despite these interventions, the economy has failed to gain meaningful traction, leaving analysts and investors skeptical about Beijing's strategy.
The iShares MSCI China ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NYSE">MCHI</a>) – a key benchmark tracking Chinese equities – continues to remain nearly 50% below its record highs achieved in February 2021. 
<h3 class="wp-block-heading">Why a Weaker Yuan Won't Fix This</h3>
The idea of weakening the yuan might sound like a magic bullet, but economists aren't sold on the effectiveness of this strategy.
"In a balance sheet recession, consumers and corporates can&#8217;t be encouraged to spend more by cutting interest rates or weakening the currency," Peccatiello said. 
"They are bleeding, and they see their net worth declining due to continued weakness in the property market."
Simply put, a weaker currency won&#8217;t rebuild shattered wealth or restore confidence among Chinese households and businesses.
<h3 class="wp-block-heading">What's The Real Solution?</h3>
For Peccatiello, the solution for China may lie in implementing a large, targeted fiscal stimulus.
Rather than broad, unspecific measures, some suggest that the government could consider directing significant spending toward struggling corporations and consumers.
The question remains: Will Beijing take substantial steps toward fiscal stimulus?
Read now: 
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</ul>
Photo: Shutterstock

Analyst Color

Macro Economic Events

Econ #s

Economics

China Eyes Yuan Devaluation To Counter Trump's Tariffs: Will It Work?

Texas Governor&nbsp;Greg Abbott (R-Texas) has directed state agencies to cease investments in China and divest existing ones. This decision, announced in a letter dated Nov. 21, highlights security and financial risks associated with Chinese investments, 
What Happened: Abbott&#8217;s directive argues that this aggression could elevate the financial risks tied to Chinese investments. The governor&#8217;s letter explicitly bans Texas investing entities from making new investments in China.
Moreover, Abbott has instructed these entities to divest from any current Chinese investments at the earliest feasible opportunity. 
&#8220;Texas will defend and safeguard itself and our public treasury from any potential threat, including those posed by the CCP,&#8221; the statement read.
See Also:&nbsp;<a href="https://www.benzinga.com/24/11/42103633/chinese-court-affirms-cryptocurrency-ownership-as-legal-as-bitcoin-breaks-97k?itm_source=parsely-api" target="_blank" rel="noreferrer noopener">Chinese Judge Cites &#8216;High-Pressure Crackdown&#8217; On Speculation In Judgment Declaring Crypto Ownership Legal As Bitcoin Moves Past $97K</a>
Why It Matters: The directive from Governor Abbott comes amid escalating U.S.-China tensions. Recently, the U.S. House of Representatives advanced two Republican bills aiming to reinstate the U.S. Justice Department's "China Initiative." This initiative seeks to <a href="https://www.benzinga.com/news/24/09/40831428/house-gop-advances-bills-to-reinstate-justice-departments-china-initiative-despite-white-house-disap">curb espionage activities</a> targeting U.S. intellectual property and academic institutions. The bills were part of the House Republican's &#8220;China Week,&#8221; which saw over two dozen China-related legislative measures passed.
President-elect Donald Trump has proposed to impose 60% tariff on Chinese goods. Chinese President Xi Jinping recently <a href="https://www.benzinga.com/24/11/42025284/xi-jinping-tells-joe-biden-china-is-ready-to-work-with-trump-as-tariff-threat-looms">expressed a willingness</a> to collaborate with the U.S. government, regardless of the administration in power. This statement was made during a meeting with President Joe Biden at the Asia-Pacific Economic Cooperation forum in Lima. 
Meanwhile, ETFs that allow investment into China have dropped during the past one month. As of Nov. 22nd, according to <a href="https://pro.benzinga.com">Benzinga Pro</a>, the KraneShares CSI China Internet ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KWEB#NYSE">KWEB</a>) has dropped by 5.97% while iShares China Large-Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FXI#NYSE">FXI</a>) fell by 5.13%. Invesco Golden Dragon China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PGJ#NASDAQ">PGJ</a>) fell by 5.41% and iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>) dropped by 5.54%.
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Disclaimer: This content was partially produced with the help of&nbsp;<a href="https://www.benzinga.com/author/benzinga-neuro" target="_blank" rel="noreferrer noopener">Benzinga Neuro</a>&nbsp;and was reviewed and published by Benzinga editors.
Image via Wikimedia Commons

Government

News

General

PowerShares Golden Dragon Halter USX China Portfolio

Texas Governor Mandates State Agencies To Divest From China: 'Will Defend And Safeguard Itself...From Any Potential Threat'

Major Chinese fund companies have&nbsp;announced a reduction in fees&nbsp;for a selection&nbsp;of equity exchange-traded funds (ETFs). This move intensifies the price war in the booming $400 billion ETF market.
What Happened: The fee cuts come a day after&nbsp;Wu Qing, China&#8217;s chief securities regulator, expressed support for index investment and fee reform in the fund industry. ETFs, which&nbsp;typically track an index and&nbsp;trade on exchanges, have seen significant growth this year as investors turn away from underperforming active fund managers, Reuters&nbsp;reported on Wednesday.
China Asset Management Co&nbsp;(ChinaAMC), leading the ETF market, announced it would reduce fees on&nbsp;eight ETF products, including the&nbsp;160 billion yuan China SSE 50 ETF. The management fee will drop to 0.15% from 0.5%, and the custodian fee to 0.05% from 0.1%.
See Also:&nbsp;<a href="https://www.benzinga.com/24/11/41862692/steve-madden-announces-plans-to-move-production-to-avoid-trump-tariffs-but-theres-a-catch?itm_source=parsely-api" target="_blank" rel="noreferrer noopener">Steve Madden Announces Plans To Move Production To Avoid Trump Tariffs, But There&#8217;s A Catch</a>
Other fund companies such as&nbsp;E Fund Management,&nbsp;Huatai-PineBridge Fund Management,&nbsp;Harvest Fund Management, and&nbsp;HuaAn Fund Management&nbsp;have made similar announcements. This trend is expected to attract more capital into the market, with net inflows into China&#8217;s onshore ETFs surpassing 900 billion yuan this year, according to BNP Paribas. 
Why It Matters: The fee reduction by major Chinese fund companies comes amid a backdrop of economic measures and market fluctuations. In October, investor sentiment was dampened when anticipated large-scale economic stimulus measures from Chinese authorities did not materialize. Despite <a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/10/41316058/chinese-stocks-etfs-struggle-as-multi-trillion-yuan-stimulus-hopes-fall-short-yet-m">signals of increased fiscal support,</a> the absence of a substantial economic package left traders underwhelmed.
Furthermore, China&#8217;s decision to cut interest rates in late October led to a decline in <a href="https://www.benzinga.com/news/24/10/41426987/us-listed-chinese-etfs-drop-after-beijing-cuts-interest-rates">several China-focused ETFs</a> in the U.S. This move, aimed at stimulating economic growth, instead raised concerns among investors about its broader implications.
Meanwhile, U.S.-listed Chinese ETFs have been providing American investors exposure to Chinese equities, bonds, or a combination of both, while being traded on U.S. stock exchanges. These ETFs are a convenient way for investors to gain diversified exposure to China&#8217;s economic growth without the complexities of directly investing in foreign markets. According to <a href="http://pro.benzinga.com">Benzinga Pro</a>, KraneShares CSI China Internet ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KWEB#NYSE">KWEB</a>), iShares China Large-Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FXI#NYSE">FXI</a>), Invesco Golden Dragon China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PGJ#NASDAQ">PGJ</a>), and iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>) are some of the popular names on the list.
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Disclaimer: This content was partially produced with the help of&nbsp;<a href="https://www.benzinga.com/author/benzinga-neuro" target="_blank" rel="noreferrer noopener">Benzinga Neuro</a>&nbsp;and was reviewed and published by Benzinga editors.
Image via Shutterstock

Chinese Fund Giants Slash ETF Fees Amid Intense Market Competition

Renowned tech investor and Palantir Technologies&#8217; co-founder&nbsp;Peter Thiel&nbsp;has made a daring prediction about the potential impact of President-elect Donald Trump&#8217;s <a href="https://www.benzinga.com/trading-ideas/movers/24/11/41902202/trumps-china-hawks-rumored-for-top-roles-yuan-hits-3-month-low">60% tariff on Chinese goods</a>.
What Happened: On Thursday, during an interview with The Free Press, Thiel suggested that such a tariff would be &#8220;very, very bad&#8221; for <a href="https://www.benzinga.com/general/social-media/24/11/41912771/trump-presidency-magnificent-7-stock-impact-benzinga-readers-pick-tech-titan-at-most-risk-following-2024-election">Chinese companies</a> and China as a whole.
However, he believes the impact on American consumers would be &#8220;mildly negative&#8221; as manufacturing would likely shift away from China.
According to Thiel, shifting manufacturing from China to Vietnam would significantly harm China, and have only a minor impact on American consumers. From a geopolitical perspective, he argued, this move would align closely with American strategic interests.
See Also:&nbsp;<a href="https://www.benzinga.com/etfs/24/11/42018463/trumps-post-election-rally-fades-dollar-surges-to-over-1-year-highs-powell-puts-december-interest-rate-cut-into-question-this-week-in-the-market?itm_source=parsely-api" target="_blank" rel="noreferrer noopener">Trump&#8217;s Post-Election Rally Fades, Dollar Surges To Over 1-Year Highs, Powell Puts December Interest Rate Cut Into Question: This Week In The Market</a>
<figure class="wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio"> 
<div class="wp-block-embed__wrapper">
<iframe loading="lazy" title="Peter Thiel on the Triumph of the Counter-Elites" width="500" height="281" src="https://www.youtube.com/embed/wwJV_NuN43Y?feature=oembed" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen></iframe>
</div>
</figure>
Why It Matters: Earlier this year, Chinese stocks <a href="https://www.benzinga.com/markets/asia/24/05/38782459/china-focused-etfs-have-become-political-footballs-in-us-as-investor-apprehension-leads-to-large-sca#google_vignette">experienced a notable rally</a>, pushing the SSE Composite Index in Shanghai to its highest point since September 2023.
However, Trump's proposed tariffs, which could reach as high as 60% on Chinese goods, along with additional import hikes on other nations, could disrupt these investments.
A day after Trump won, China-linked ETFs witnessed a sharp fall after rallying for nearly two months.
<figure class="wp-block-table"> 
<table>
<tbody>
<tr>
<td>China-linked ETFs</td>
<td>Share Price Drop On Nov. 6, 2024</td>
</tr>
<tr>
<td>KraneShares CSI China Internet ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KWEB#NYSE">KWEB</a>)</td>
<td>2.01%</td>
</tr>
<tr>
<td>iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>)</td>
<td>2.70%</td>
</tr>
<tr>
<td>iShares China Large-Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FXI#NYSE">FXI</a>)</td>
<td>2.94%</td>
</tr>
</tbody>
</table>
</figure>
U.S.-listed Chinese stocks such as Alibaba Group Holding (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BABA#NYSE">BABA</a>), JD.com (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/JD#NASDAQ">JD</a>), Baidu (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/BIDU#NASDAQ">BIDU</a>), NIO Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/NIO#NYSE">NIO</a>), Li Auto Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/LI#NASDAQ">LI</a>), and XPeng Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XPEV#NYSE">XPEV</a>) also <a href="https://www.benzinga.com/government/24/11/41773691/us-listed-chinese-stocks-like-alibaba-jd-nio-fall-after-trumps-win-whats-going-on">saw a decline in trading</a> following Trump&#8217;s win.
The imposition of such tariffs could strain China's economic growth, negatively impacting the performance of <a href="https://www.benzinga.com/general/social-media/24/11/41912771/trump-presidency-magnificent-7-stock-impact-benzinga-readers-pick-tech-titan-at-most-risk-following-2024-election">China-focused ETFs</a>, particularly those tied to the tech sector and large-cap companies, making them less attractive to investors.
Despite the immediate economic challenges that such a tariff would pose, some experts believe that China may view Trump's return to the White House as <a href="https://www.benzinga.com/news/global/24/11/41870809/china-may-benefit-from-trumps-return-to-white-house-despite-his-tariff-plans-says-expert-short-term-pain-but-potentially-long-term-strategic-gain">an opportunity for strategic advantage</a>.
Earlier this week, Chinese President Xi Jinping also expressed China's willingness to <a href="https://www.benzinga.com/24/11/42025284/xi-jinping-tells-joe-biden-china-is-ready-to-work-with-trump-as-tariff-threat-looms">collaborate with the U.S. government</a>, regardless of the administration in power.
Image via Wikimedia
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Disclaimer: This content was partially produced with the help of&nbsp;<a href="https://www.benzinga.com/author/benzinga-neuro" target="_blank" rel="noreferrer noopener">Benzinga Neuro</a>&nbsp;and was reviewed and published by Benzinga editors.

XPEV

Peter Thiel Says Trump's 60% China Tariff Would Be 'Very, Very Bad' For Beijing, Here's What's At Stake

Emerging market stocks have dropped to levels last seen in mid-September, with the downturn exacerbated by Donald Trump's victory and a Republican sweep<a href="https://www.benzinga.com/topic/donald-trump"> of the U.S. Congress.</a>
The iShares MSCI Emerging Markets ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/EEM#NYSE">EEM</a>) has slumped 7% over the past month, with the iShares MSCI China ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NYSE">MCHI</a>) and the iShares Mexico ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/EWW#NYSE">EWW</a>) underperforming — down 10.1% and 7.8%, respectively.
Trump&#8217;s win and full Republican control of Washington, D.C. raise critical questions for emerging markets (EM). What does a more protectionist U.S. policy and potential fiscal loosening mean for emerging economies, currencies and credit conditions?
<h1 class="wp-block-heading">Why Are Emerging Markets Falling?</h1>
Trump's election has sparked concerns over possible shifts in U.S. fiscal and trade policies that could have a ripple effect on global markets. 
&#8220;The prospects of looser fiscal policy and more trade protectionism have increased short- and long-term U.S. interest rates, putting upward pressure on borrowing costs in EMs,&#8221; according to Elijah Oliveros-Rosen, chief emerging markets economist at S&amp;P Global Ratings.
Higher U.S. interest rates tend to strengthen the dollar, making it more expensive for emerging markets to service dollar-denominated debt. This tighter financial environment has already started affecting emerging market currencies, which have weakened across the board against the dollar.
<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="503" src="https://editorial-assets.benzinga.com/wp-content/uploads/2024/11/14120359/image-159-1024x503.png" alt="" class="wp-image-648524" srcset="https://editorial-assets.benzinga.com/wp-content/uploads/2024/11/14120359/image-159-1024x503.png 1024w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/11/14120359/image-159-300x147.png 300w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/11/14120359/image-159-768x377.png 768w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/11/14120359/image-159-1536x754.png 1536w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/11/14120359/image-159.png 1920w" sizes="(max-width: 1024px) 100vw, 1024px" /></figure>
<h1 class="wp-block-heading">EM Currency Depreciation: A Major Concern</h1>
Following Trump's win, most EM currencies — especially in Central and Eastern Europe and Latin America — have depreciated significantly against the U.S. dollar.
Investors worry the Federal Reserve may delay rate cuts in response to Trump&#8217;s policies, which could include new tariffs or stricter immigration rules. A stronger dollar and potential trade barriers pose serious risks for EM economies reliant on exports and foreign investment.
The Mexican peso, in particular, has been hit hard by Trump's election, as uncertainty over trade and immigration policies toward Mexico has made investors skittish. 
Private fixed investment in Mexico, which has been strong over the last two years due to nearshoring, could lose momentum until there's more clarity on U.S. policy.
&#8220;During the Trump 2016-2020 administration (excluding the pandemic), private fixed investment in Mexico declined 4.5%,&#8221; S&amp;P Global wrote in a report. 
<h1 class="wp-block-heading">Tightening Financial Conditions For EM</h1>
The rise in U.S. interest rates is tightening financial conditions for EMs, which rely heavily on affordable credit to finance growth. 
With borrowing costs rising, fiscal vulnerabilities in these markets could become more pronounced, potentially limiting governments' ability to stimulate their economies.
"Volatility in emerging market assets is expected to remain elevated for some time due to uncertainties surrounding U.S. policy details including trade, fiscal, and regulatory environment," said Oliveros-Rosen. 
Investors are likely to remain on edge until the new administration clarifies its approach, particularly toward trade.
<h1 class="wp-block-heading">Impact On Credit Ratings, Market Activity</h1>
The tightening financial environment is already impacting EM credit ratings.
 While the number of issuers rated ‘CCC+' and below has decreased slightly, indicating some deleveraging, many EM companies are still struggling with high debt levels. Riskier credits have been able to refinance for the first time since November 2021, but this could come at the cost of reduced capital expenditures in 2025-2026.
Corporate bond spreads in EMs remain tight, supporting robust market activity for speculative-grade issuers. With two months left in 2024, all EM regions — except for Asia — have already surpassed their average bond issuance volumes from the last seven years. Both benchmark and corporate yields have edged up amid the uncertainty, reflecting a more cautious investor sentiment.
<h1 class="wp-block-heading">Long-Term Outlook: Headwinds, Opportunities</h1>
Looking ahead, EMs face a mixed outlook. In the near term, "volatility in emerging market assets is expected to remain elevated for some time due to uncertainties surrounding U.S. policy details including, trade, fiscal, and regulatory environment,&#8221; S&amp;P Global wrote. 
Yet, demographics, technology, and the global energy transition could provide structural growth tailwinds over the next decade, potentially offsetting some of the risks posed by a protectionist U.S. stance. 
Supply-chain shifts and nearshoring trends, particularly in regions like Latin America, may also help some EMs attract investment.
As Oliveros-Rosen stated, "The specific policies announced by the next U.S. administration could either further amplify or reverse the recent tightening in financial conditions, with implications for EM growth and credit conditions."
In other words, the ball is in Washington's court. Whether EMs face a full-blown crisis or simply a period of adjustment will depend largely on Trump's policy choices in 2025.
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Photo: Shutterstock

Emerging Markets

Trump's Red Wave Pushes Emerging Market Stocks To 2-Month Lows: Volatility 'Expected To Remain Elevated'

China&#8217;s recent decision to cut interest rates has led to a decline in several China-focused exchange-traded funds (ETFs). The move, aimed at stimulating economic growth, has instead sparked concerns among investors about its broader implications.
What Happened: Several China-focused ETFs experienced declines following the country&#8217;s interest rate reduction. According to <a href="https://pro.benzinga.com">Benzinga Pro</a>, the KraneShares CSI China Internet ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KWEB#NYSE">KWEB</a>) fell by 2.30% on Monday pre-market. The iShares China Large-Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FXI#NYSE">FXI</a>) saw a decrease of 1.74%, while the Invesco Golden Dragon China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PGJ#NASDAQ">PGJ</a>) dropped by 0.85%. iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>) also dropped by 1.56%.
See Also: <a href="https://www.benzinga.com/news/24/10/41415419/kevin-oleary-calls-for-400-tariffs-on-china-but-his-shark-tank-co-star-and-friend-mark-cuban-fires-b?itm_source=parsely-api" target="_blank" rel="noreferrer noopener">Kevin O&#8217;Leary Calls for 400% Tariffs On China, But His &#8216;Shark Tank&#8217; Co-Star And Friend Mark Cuban Fires Back With Business Concerns</a>
These declines come amid China&#8217;s decision to cut interest rates, a move that typically aims to stimulate economic growth. However, the immediate impact on these ETFs suggests investor concerns about the broader implications of such monetary policy adjustments.
Why It Matters: The rate cuts come at a time when investor sentiment towards Chinese markets is already fragile. Hopes for a<a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/10/41316058/chinese-stocks-etfs-struggle-as-multi-trillion-yuan-stimulus-hopes-fall-short-yet-m"> multi-trillion-yuan stimulus</a> package were dashed when Chinese authorities failed to deliver the anticipated measures. This lack of concrete fiscal support has left traders underwhelmed, despite signals of increased fiscal support.
Further compounding the issue, U.S.-listed Chinese stock<a href="https://www.benzinga.com/news/24/10/41424736/alibaba-nio-baidu-stocks-decline-amid-chinas-rate-cuts-whats-going-on">s also experienced a downturn</a> as Beijing implemented a reduction in its primary lending rates. Major companies such as Alibaba Group Holding Ltd , Baidu, Inc. , and NIO Inc. saw significant declines. This indicates a broader market reaction to China&#8217;s monetary policy adjustments, affecting both domestic and international investors.
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Disclaimer: This content was partially produced with the help of <a href="https://www.benzinga.com/author/benzinga-neuro" target="_blank" rel="noreferrer noopener">Benzinga Neuro</a> and was reviewed and published by Benzinga editors.
Image via Shutterstock

Pre-Market Outlook

US-Listed Chinese ETFs Drop After Beijing Cuts Interest Rates

Chinese tech giants Alibaba Group Holding Ltd &#8211; ADR (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BABA#NYSE">BABA</a>), JD.Com Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/JD#NASDAQ">JD</a>) and Baidu Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/BIDU#NASDAQ">BIDU</a>) all gained early Friday, driven by stronger-than-expected <a href="https://www.benzinga.com/news/24/10/41399129/why-us-listed-china-etfs-are-gaining-up-to-6-in-fridays-premarket">GDP figures from China.</a>
The upbeat economic data has invigorated market sentiment, pushing U.S.-listed Chinese stocks higher and contributing to a rally in China-based exchange-traded funds (ETFs).
Additionally, per a Bloomberg <a href="https://www.bloomberg.com/news/articles/2024-10-18/china-s-further-slowdown-highlights-urgency-for-more-stimulus">report </a>early Friday, markets also found unexpected optimism in the People's Bank of China (PBOC). A speech from Governor Pan Gongsheng, along with the announcement of a support program for share buybacks, lifted market sentiment.
The National Bureau of Statistics expressed confidence that there is "large room" for further policy action this year, with a "very likely" chance of economic recovery, <a href="https://www.bloomberg.com/news/live-blog/2024-10-18/china-gdp-key-economic-indicators?sref=TBDibEcD">according </a>to Bloomberg. The bureau also noted that the external environment is &#8220;increasingly complex and grim&#8221; and the economy's foundation for a rebound needs to be further solidified. 
What Happened With GDP Data: China&#8217;s GDP expanded by 4.6% year-over-year in the third quarter, beating a Reuters poll forecast of 4.5%. Although the growth was marginally below the previous quarter's figure of 4.7%, it reassured investors that the world&#8217;s second-largest economy remains resilient despite recent challenges.
Alongside the GDP data, other indicators such as a 5.4% rise in industrial output and a 3.2% increase in retail sales further solidified optimism during Friday&#8217;s session.
Read Also: <a href="https://www.benzinga.com/markets/asia/24/10/41324527/as-chinas-stimulus-hype-wanes-beijing-reportedly-weighs-850b-special-treasury-bonds-to-stimulate-eco?itm_source=parsely-api">As China&#8217;s Stimulus Hype Wanes, Beijing Reportedly Weighs $850B Special Treasury Bonds To Stimulate Economy And Tackle Local Debt</a>
U.S.-listed ETFs tracking Chinese companies saw a sharp rise on the news. The KraneShares CSI China Internet ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/KWEB#NASDAQ">KWEB</a>), a fund heavily exposed to major Chinese tech firms, gained 4.5% early Friday. The iShares China Large-Cap ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/FXI#NASDAQ">FXI</a>) and iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>) also gained 4% each as investors looked to capitalize on the promising data.
Why This Matters For Alibaba: Alibaba, one of China's leading e-commerce platforms, is particularly sensitive to retail sales growth, making the better-than-expected retail data a boon for its stock. The company, which operates across multiple segments including online retail, cloud computing and digital media, stands to benefit from renewed consumer spending. 
With retail sales up by 3.2% in September, Alibaba is poised to capitalize on increased consumer activity and potentially stronger demand during the upcoming holiday shopping season.
Why This Matters For JD.com: JD.com, another key player in the Chinese e-commerce space, also experienced a boost from the positive GDP data. The company, known for its robust logistics network and dominance in online retail, is similarly tied to retail sales figures.
The industrial output increase of 5.4% was particularly relevant for JD, as its business relies on a smooth and efficient supply chain to meet growing demand.
Read Also: <a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/10/41402089/goldman-sachs-highlights-20-top-short-squeeze-opportunities-for-q3-earnings-season">Goldman Sachs Highlights 20 Top Short-Squeeze Opportunities For Q3 Earnings Season</a>
Why This Matters For Baidu: Baidu, China's most popular search engine and AI company, also saw its shares jump as part of the broader rally in Chinese tech stocks. Baidu has been expanding its reach into artificial intelligence and autonomous driving, areas that could benefit from China&#8217;s overall economic growth. 
As industrial activity rises, Baidu&#8217;s AI-driven enterprise services, cloud computing and autonomous driving ventures are expected to see increased demand. Moreover, improvements in consumer spending could boost Baidu's core advertising business, which is highly reliant on the health of the broader economy.
The Bigger Picture: China&#8217;s positive economic data arrives at a crucial time. Global markets have been increasingly concerned about the country's growth prospects amid a slowing property market and ongoing geopolitical tensions.
While concerns over declining house prices remain – with a sharper 5.8% drop year-over-year in September – the broader economy appears to be gaining strength. Investors interpret this data as a sign that <a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/09/41032804/chinas-stimulus-sparks-optimism-3-large-cap-stocks-with-analyst-buy-ratings" target="_blank" rel="noopener">China's targeted stimulus measures and government interventions</a> may stabilize the economy.
With Beijing reportedly considering further fiscal measures, including an <a href="https://www.benzinga.com/markets/asia/24/10/41324527/as-chinas-stimulus-hype-wanes-beijing-reportedly-weighs-850b-special-treasury-bonds-to-stimulate-eco?itm_source=parsely-api">$850 billion special treasury bond</a> to stimulate the economy and tackle local debt, the stage may be set for continued momentum in China's stock market.
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Photo: Shutterstock

Alibaba, JD.com, Baidu Stocks Climb On Strong China GDP Growth, Rising Consumer Spending

China&#8217;s stronger-than-expected GDP figures for the third quarter have led to a notable surge in U.S.-listed China-based ETFs during pre-market trading. This economic data has provided a boost to several key ETFs.
What Happened: China-based U.S.-listed ETFs experienced a significant uptick in pre-market trading following the release of robust<a href="https://www.benzinga.com/markets/asia/24/10/41398004/why-are-alibaba-nio-jd-com-and-other-us-listed-chinese-stocks-surging-today"> GDP figures from China.</a> According to <a href="https://pro.benzinga.com">Benzinga Pro</a>, the KraneShares CSI China Internet ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KWEB#NYSE">KWEB</a>) rose by 6.06%, while the iShares China Large-Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FXI#NYSE">FXI</a>) increased by 4.93%. The iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>) also climbed 5.15%.
China&#8217;s GDP grew by <a href="https://www.benzinga.com/markets/equities/24/10/41182930/china-was-tipping-into-a-japan-style-lost-decade-of-deflation-and-stagnation-before-late-septemb">4.6% year-over-year </a>in the third quarter, surpassing the 4.7% prediction of Reuters poll. However, this growth was slightly below the 4.7% recorded in the previous quarter, marking the slowest pace since mid-last year and moving further from Beijing&#8217;s 5% annual target.
See Also: <a href="https://www.benzinga.com/markets/asia/24/10/41324527/as-chinas-stimulus-hype-wanes-beijing-reportedly-weighs-850b-special-treasury-bonds-to-stimulate-eco?itm_source=parsely-api" target="_blank" rel="noreferrer noopener">As China&#8217;s Stimulus Hype Wanes, Beijing Reportedly Weighs $850B Special Treasury Bonds To Stimulate Economy And Tackle Local Debt</a>
Retail sales in September increased by 3.2% year-on-year, exceeding forecasts, while industrial output rose by 5.4%, also beating expectations. Despite these positive indicators, house prices fell by 5.8% year-over-year in September, a larger decline compared to August&#8217;s 5.3% drop. Meanwhile, the CSI 300 index in Mainland China surged 3.62% to close at 3,925.23, after reaching an intraday high of 5.5%.
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Disclaimer: This content was partially produced with the help of&nbsp;<a href="https://www.benzinga.com/author/benzinga-neuro" target="_blank" rel="noreferrer noopener">Benzinga Neuro</a>&nbsp;and was reviewed and published by Benzinga editors.
Image via Shutterstock

Why US-Listed China ETFs Are Gaining Up To 6% In Friday's Premarket

China is reportedly considering issuing 6 trillion yuan, approximately $850 billion, in ultra-long special treasury bonds over the next three years. This potential move aims to bolster the nation&#8217;s slowing economy through fiscal stimulus.
What Happened: Sources indicate that the funds from these bonds will be partially used to help local governments manage their hidden debts. This speculation follows the Ministry of Finance&#8217;s announcement to address local government debt pressures, although specific figures were not disclosed during a recent press briefing, according to a <a href="https://www.caixinglobal.com/2024-10-14/exclusive-china-may-issue-6-trillion-yuan-in-treasury-bonds-to-buttress-economy-102245341.html">report</a> by Caixin Global on Tuesday.
See Also: <a href="https://www.benzinga.com/markets/equities/24/10/41322578/teslas-chinese-rivals-move-to-calm-fears-of-an-european-invasion-that-threatens-legacy-players-n?itm_source=parsely-api" target="_blank" rel="noreferrer noopener">Tesla&#8217;s Chinese Rivals Move To Calm Fears Of An European &#8216;Invasion&#8217; That Threatens Legacy Players: &#8216;Not Going To Overthrow Anybody Who&#8217;s Developed Over 100 Years&#8217;</a>
Xing Zhaopeng, a senior China strategist at ANZ, shared with Reuters that this development aligns with expectations. He stated, &#8220;For next year, we still think a growth target of around 5% is likely to be maintained. So, for a 5% growth rate, that should be enough.&#8221;
Why It Matters: The anticipation of China&#8217;s fiscal stimulus has been a significant factor influencing investor sentiment. Recently, <a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/10/41316058/chinese-stocks-etfs-struggle-as-multi-trillion-yuan-stimulus-hopes-fall-short-yet-m">U.S.-listed Chinese stocks</a> experienced a downturn as investors were left underwhelmed by a high-level briefing from Chinese authorities that did not meet expectations for substantial economic measures. Despite hints of increased fiscal support, the absence of a large-scale package has left traders disappointed.
Stocks such as Alibaba Group Holding (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BABA#NYSE">BABA</a>), Baidu, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/BIDU#NASDAQ">BIDU</a>), and JD.com, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/JD#NASDAQ">JD</a>) have seen declines of 6% to over 8% in the past five days. Similarly, Chinese electric vehicle stocks like NIO Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/NIO#NYSE">NIO</a>) and XPeng Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XPEV#NYSE">XPEV</a>) <a href="https://www.benzinga.com/government/24/10/41312039/whats-going-on-with-us-listed-chinese-stocks-alibaba-baidu-nio-xpeng-on-monday">have also traded lower</a>, with other EV stocks, including Li Auto Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/LI#NASDAQ">LI</a>), losing over 3% to 11% in the same period.
Price Action: According to <a href="https://pro.benzinga.com">Benzinga Pro</a>, at the time of writing on Tuesday during the after-hours, Invesco Golden Dragon China (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PGJ#NASDAQ">PGJ</a>) was showed a 2.13% decline while iShares MSCI China Multisector Tech ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TCHI#NASDAQ">TCHI</a>) was up by 4.28%, Meanwhile, iShares China Large Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FXI#NYSE">FXI</a>) was up by 0.27%, while iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>) was down by 0.35%.
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</ul>
Disclaimer: This content was partially produced with the help of&nbsp;<a href="https://www.benzinga.com/author/benzinga-neuro" target="_blank" rel="noreferrer noopener">Benzinga Neuro</a>&nbsp;and was reviewed and published by Benzinga editors.
Image via Shutterstock

TCHI

As China's Stimulus Hype Wanes, Beijing Reportedly Weighs $850B Special Treasury Bonds To Stimulate Economy And Tackle Local Debt

Both the S&amp;P 500 and the Dow Jones Industrial Average extended their record highs on Monday, reflecting continued bullish sentiment as investors anticipate key <a href="https://www.benzinga.com/earnings">corporate earnings reports </a>later this week.
The S&amp;P 500 surged past 5,850 points during midday trading in New York, while the Dow Jones broke above the 43,000 mark for the first time. Wall Street celebrated the two-year anniversary of <a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/10/41314387/most-widely-hated-bull-market-reaches-2-year-milestone-top-20-s-p-500-stocks-drivin">the bull market&#8217;s start.</a>
However, the Nasdaq 100 is still lagging. It gained 0.7% on the day but remains about 1% below its all-time high set on July 10.
Small-cap stocks also advanced, with the Russell 2000 climbing 0.6%. Among sectors, utilities and technology led the gains, while semiconductors and homebuilders were the top-performing industries.
Despite no major economic data releases, U.S. Treasury yields edged higher, with the 10-year yield reaching 4.13%, its highest level since late July. The U.S. dollar also rose by 0.3%.
Commodities were the weakest asset class, weighed down by uncertainty over China&#8217;s stimulus measures. Gold, silver, and copper fell 0.4%, 1.2%, and 2%, respectively. Crude oil prices dropped 2.3% as OPEC&#8217;s weakening demand outlook dampened sentiment.
Chinese equities, tracked by the iShares MSCI China ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NYSE">MCHI</a>), declined 1.1%.
In the crypto space, Bitcoin (CRYPTO: <a class="ticker" href="https://www.benzinga.com/quote/btc/usd">BTC</a>) stood out as the best performer, rallying 4.5% to surpass $65,000. Other cryptocurrencies and crypto-linked stocks followed its lead.
<h3 class="wp-block-heading">Monday&#8217;s Performance In Major US Indices, ETFs</h3>
<figure class="wp-block-table is-style-stripes"> 
<table>
<tbody>
<tr>
<td>Major Indices</td>
<td>Price</td>
<td>1-day %chg</td>
</tr>
<tr>
<td>S&amp;P 500</td>
<td>5,857.62</td>
<td>0.7%</td>
</tr>
<tr>
<td>Nasdaq 100</td>
<td>20,409.65</td>
<td>0.7%</td>
</tr>
<tr>
<td>Russell 2000</td>
<td>2,245.80</td>
<td>0.6%</td>
</tr>
<tr>
<td>Dow Jones</td>
<td>43,027.29</td>
<td>0.4%</td>
</tr>
</tbody>
</table>
<figcaption class="wp-element-caption">Updated at 12:30 p.m. ET</figcaption></figure>
According to <a href="https://bzresearch.myclickfunnels.com/benzinga-pro-content-webinar-registration/?utm_source=BZprocontent101124&amp;t=be2bearmibe3na1">Benzinga Pro</a> data: 
<ul>
<li>The&nbsp;SPDR S&amp;P 500 ETF Trust&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPY#NYSE">SPY</a>)&nbsp;rose 0.7% to $583.72.</li>
<li>The&nbsp;SPDR Dow Jones Industrial Average&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DIA#NYSE">DIA</a>)&nbsp;rose 0.4% to $430.59.</li>
<li>The tech-heavy Invesco QQQ Trust Series (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QQQ#NASDAQ">QQQ</a>) rallied 0.8% to $497.15.</li>
<li>The iShares Russell 2000 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IWM#NYSE">IWM</a>) rose 0.6% to $222.52.</li>
<li>The Technology Select Sector SPDR Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XLK#NYSE">XLK</a>) outperformed, up 1.2%. The Energy Select Sector SPDR Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XKE#NYSE">XKE</a>) lagged, down 0.3%.</li>
</ul>
<h3 class="wp-block-heading">Monday&#8217;s Stock Movers</h3>
<ul>
<li>Vistra Corp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VST#NYSE">VST</a>) surged more than 5% after BNP Paribas initiated coverage with an Outperform rating and a $231 price target.</li>
<li>Wells Fargo &amp; Co. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/WFC#NYSE">WFC</a>) rallied 3.7%, after soaring 5.6% Friday, after Bank of America Securities raised the price target on the stock from $70 to $75. </li>
<li>SoFi Technologies Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SOFI#NASDAQ">SOFI</a>) soared over 9% following the announcement of a major agreement with Fortress Investment Group LLC for its loan-platform business.</li>
<li>Upstart Holdings Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/UPST#NASDAQ">UPST</a>) jumped over 4% after Wedbush upgraded the stock to Neutral, boosting its price target from $10 to $45.</li>
<li>Coinbase Global Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/COIN#NASDAQ">COIN</a>), CleanSpark Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/CLSK#NASDAQ">CLSK</a>) and MARA Holdings Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MARA#NASDAQ">MARA</a>) rallied 7.7%, 7.3% and 5.4%, respectively, on the heels of Bitcoin&#8217;s rally. </li>
</ul>
Read Next:
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<li><a href="https://www.benzinga.com/markets/24/10/41302909/18-stocks-to-buy-7-to-sell-this-earnings-season-goldman-sachs-calls-it-the-year-of-the-stock-picker">18 Stocks To Buy, 7 To Sell This Earnings Season: Goldman Sachs Calls It &#8216;The Year Of The Stock Picker&#8217;</a></li>
</ul>
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S&P 500 Extends Record Highs, Dow Breaks 43,000 Ahead Of Pivotal Earnings Week, Bitcoin's Rally Lifts Crypto Stocks: What's Driving Markets Monday?

The market&#39;s price action and attention are making a new shift this quarter. For most of 2024, everyone wanted to find the next best thing in the United States technology sector, as the semiconductor industry saw massive rallies in shares of NVIDIA Co. However, it seems that the industry has run its course, and investors are now left to find the next hot trend, which came up in an unlikely place worldwide.
Asia&#39;s powerhouse, China, has recently sparked a new stock market rally after cutting interest rates by 50 basis points and injecting a few billion in capital into the economy to support its faltering financial markets. Some of the nation&#39;s biggest companies saw their stocks break out into multi-year highs, from valuations that were undeniably low to attract some of the United States&#39; best investors and fund managers.
These stock picks include names like Alibaba Group (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/baba#NYSE">BABA</a>), which is the fit choice amongst many investors today looking to get exposure to China. Then, there is Baidu Inc. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/bidu#NASDAQ">BIDU</a>), serving as a companion to the technology sector. For those investors who don&#39;t feel comfortable&nbsp;investing in individual stocks, the&nbsp;iShares MSCI China ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/mchi#NASDAQ">MCHI</a>) can&nbsp;diversify their capital across different industries and companies.
<h2>For Investors Who Missed the First Rally, China&#39;s Markets Are Offering a Second Chance</h2>
Even after having the best days in over two years and bringing these stocks to new valuations, reality fell short of bullish expectations to justify keeping the rally going for these stocks. At least, this is what the media headlines are blaming the recent retracement on, ignoring the fact that there might have been a lot of old business &quot;stuck&quot; on these stocks waiting to get out.
When investors realize that stocks like Alibaba and others in the iShares China ETF spent just over two years trading in a near-flat channel, it&#39;s easier to imagine many premature bulls holding onto their positions and waiting for the first big rally to start unloading some of their inventory.
That might be what&#39;s actually happening at the moment, and that&#39;s why investors should not take the current sell-off lightly or as anything short of an opportunity to get in before the sentiment continues. Surely, some investors who recently bought these stocks before the rally may be obligated to trim down their positions for weighing purposes, but that doesn&#39;t mean they&#39;re suddenly bears.
Investors like Michael Burry and David Tepper recently chose to make Alibaba their largest position. Institutional players like these two have to decrease the weight of a stock if its position becomes too big compared to the rest of its holdings. This, combined with old stuck bulls getting out, might have caused the sell-offs.
However, Wall Street analysts recognize these stocks for their double-digit upside potential and high-quality business models. China&#39;s economy is just starting to come off its bottoming cycle, so it would seem that only clear skies lie ahead for this nation and the Asian region.
<h2>Worst Day in the Market? A Golden Opportunity for Value Investors</h2>
After suffering a 10.8% decline in a single day, the iShares China ETF just posted its worst day in history this week. However, that doesn&#39;t have to mean everyone should get out; in fact, just the opposite might be true.
The same goes for Alibaba and Baidu, as these two stocks fell by 6.7% and 7.4%, respectively, in a single day.
Compared to today&#39;s prices, investors can see that current Wall Street valuations and projections would place an attractive value proposition for these companies in the next 12 months; here&#39;s what these analysts have to say.
<h2>Alibaba&#39;s Recovery Still Intact</h2>
While the consensus price target for Alibaba stock is now set at $111.1 a share, a few analysts felt bold enough to stand out from the pack. Leading the way were those at Macquarie, upgrading Alibaba stock to an &quot;Outperform&quot; rating, a new view that was coupled with a $145 a share price target for the company.
To prove these analysts right, the stock would need to rally by as much as 32.2% from where it has gotten to today. More than that, Alibaba&#39;s management has approved a stock buyback program of up to $25 billion for this year, representing roughly 10% of the company&#39;s market capitalization today.
<h2>Baidu&#39;s Value Proposition Seems Best</h2>
What better way to play the world&#39;s fastest-growing middle class than by having access to consumer and user data on a daily basis, as well as being able to monetize such data to other businesses that might find it useful. Investors can think of Baidu as America&#39;s Alphabet Inc., only with a few more years of high growth.
Wall Street&#39;s consensus price target of $132.1 a share calls for a net upside of as much as 24.6% from where it trades today, especially after the recent sell-off. More than that, Baidu is one of Michael Burry&#39;s top five holdings in his fund, and if he&#39;s known for anything, it is for being right on his big bets.
Based on the noncyclical nature of Baidu&#39;s business, unlike Alibaba&#39;s dependence on consumer discretionary trends, it is the best path to a recovery stemming from its value proposition to investors today.
The article &quot;<a href="https://www.marketbeat.com/stock-ideas/this-major-sell-off-in-chinese-stocks-could-be-your-buy-signal/">This Major Sell-Off in Chinese Stocks Could Be Your Buy Signal</a>&quot; first appeared on MarketBeat.

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This Major Sell-Off in Chinese Stocks Could Be Your Buy Signal

U.S.-listed Chinese stocks faced a <a href="https://www.benzinga.com/topic/china">sluggish start to the week</a>. 
Investor sentiment faltered following a high-level briefing from Chinese authorities that lacked the concrete stimulus measures many had anticipated. 
Despite signals of increased fiscal support, the absence of a large-scale economic package left traders underwhelmed.
<h3 class="wp-block-heading">Weekend Briefing Misses Expectations</h3>
To stabilize the economy, the Chinese Ministry of Finance (MoF) hinted at a press conference on Oct. 12 that it may raise the government debt ceiling, support local governments, address issues in the property market, and bolster major banks.
However, the MoF stopped short of announcing the multi-trillion-yuan stimulus package that markets had hoped for. 
The lack of details on measures to boost consumer demand and spark a stronger economic recovery weighed heavily on investor sentiment. 
<h3 class="wp-block-heading">Key Announcements</h3>
<ul>
<li>The MoF indicated that $300 billion (RMB2.3 trillion) in local government special bond funds would be used in Q4, suggesting a more aggressive fiscal push toward the end of the year.</li>
<li>The National Development and Reform Commission (NDRC) announced plans to pre-approve RMB200 billion worth of projects for 2024 by the end of October, intending to start construction by year-end.</li>
</ul>
<h3 class="wp-block-heading">Analyst Reactions</h3>
Helen Qiao, Asian economist at Bank of America, emphasized that the market had been eagerly awaiting more specific details about the upcoming fiscal stimulus.
"Markets have been keen to know the size, timing, and composition of any potential fiscal package," she said in a note.
&#8220;While the Oct. 12 announcement appears to lack details, in our view, it does not rule out a decent-sized fiscal package to be rolled out in the coming weeks,&#8221; Qiao added.
Qiao also indicated that while more measures to boost consumption &#8216;are still on the table,&#8217; though they are not expected until 2025. 
&#8220;As we have cautioned earlier, the MoF is not in the capacity of announcing any budget revisions before receiving greenlights from the NPC.&#8221;
Hui Shan, an economist at Goldman Sachs, saw the briefing as a sign that China is refocusing its economic policy towards growth.
&#8220;Although the much-anticipated Ministry of Finance (MoF) press conference on October 12 did not spell out great details on the upcoming fiscal stimulus package, officials provided strong forward guidance on increased fiscal support,&#8221; Shan said.
She further highlighted a shift in policy focus: &#8220;The Chinese government has clearly made a turn on cyclical policy management and increased its focus on growth.&#8221;
As a result of this shift, Goldman Sachs revised its fourth-quarter growth forecast, raising it from 5.5% to 7.5% on a quarter-over-quarter basis. The firm also increased its 2024 GDP forecast from 4.7% to 4.9%, and raised its 2025 GDP forecast from 4.3% to 4.7%. 
<h2 class="wp-block-heading">Mixed Performances For Chinese Stocks</h2>
Following the announcement, U.S.-listed Chinese stocks experienced a mixed response. Several key names suffered losses as disappointment over the lack of immediate stimulus took hold.
<ul>
<li>Alibaba Group Holdings Ltd. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BABA#NYSE">BABA</a>) slipped 0.6%.</li>
<li>PDD Holdings Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PDD#NASDAQ">PDD</a>) fell 2.8%.</li>
<li>Baidu Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/BIDU#NASDAQ">BIDU</a>) dropped 3.9%.</li>
</ul>
However, not all stocks saw declines:
<ul>
<li>JD.com Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/JD#NASDAQ">JD</a>) bucked the trend, rising 2.3%.</li>
<li>KE Holdings Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/BEKE#NASDAQ">BEKE</a>), a real estate broker, surged over 5% on optimism about future property market support.</li>
</ul>
<h3 class="wp-block-heading">Chinese ETFs also reacted, largely trending downward:</h3>
<ul>
<li>iShares China Large Cap ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FXI#NYSE">FXI</a>) stayed flat.</li>
<li>iShares MSCI China ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NYSE">MCHI</a>) dipped 0.3%.</li>
<li>KraneShares CSI Internet China ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/KWEB#NYSE">KWEB</a>) fell 0.9%.</li>
<li>Invesco Golden Dragon China (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PGJ#NASDAQ">PGJ</a>) declined 0.7%.</li>
<li>First Trust China AlphaDEX Fund (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/FCA#NASDAQ">FCA</a>) dropped 0.5%.</li>
<li>iShares China Multisector Tech ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TCHI#NYSE">TCHI</a>) slid 1.2%.</li>
<li>Franklin FTSE China ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FLCH#NYSE">FLCH</a>) edged down 0.2%.</li>
</ul>
Read now:
<ul>
<li><a href="https://www.benzinga.com/government/24/10/41312039/whats-going-on-with-us-listed-chinese-stocks-alibaba-baidu-nio-xpeng-on-monday">What&#8217;s Going On With US Listed Chinese Stocks Alibaba, Baidu, Nio, XPeng on Monday?</a></li>
</ul>
Image: Shutterstock

BEKE

Chinese Stocks, ETFs Struggle As Multi-Trillion-Yuan Stimulus Hopes Fall Short, Yet More Measures 'Are Still On The Table'

China&#39;s economy has struggled in recent months amid a depressed level of consumer confidence and a devastating housing bust coupled with weak credit demand. Late in September&mdash;just after the U.S. Federal Reserve announced its first federal funds rate cut in several years&mdash;the People&#39;s Bank of China unveiled a three-part monetary stimulus program to reduce reserve requirement ratios (the amount of cash banks are required to keep on hand), mortgage rates and down payment requirements, and more.
Some economists view monetary easing of this kind as limited in its potential impact during an economic downturn. Still, the immediate response of Chinese markets to the announcement has been a flurry of activity and a significant rally. The CSI 300, an index representing 300 of the largest publicly traded, Chinese-listed companies, is up by nearly 24% in the last month. Following the stimulus reveal, it had its&nbsp;single best day in nearly two decades.
A dip in Hong Kong stocks late in September prompted investors to speculate about how long the rally would continue. Indeed, consensus seems to be growing that a sharp reversal may be in store at some point if the stimulus measures are deemed to be ineffective overall. Still, there are several companies investors may wish to focus on during the boom.
<h2>NIO: Jolt for EV Maker</h2>
The Chinese government&#39;s stimulus package has helped to propel EV maker NIO Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/nio#NYSE">NIO</a>) upward by more than 55% in the last month, though the stock remains down more than a quarter overall in the last year.
Besides the boost tied with the broader Chinese equities space, NIO has experienced added momentum thanks to its late-September announcement of a RMB3.3 billion investment in its NIO China subsidiary from external investors, alongside a commitment of an additional RMB10 billion that NIO itself will make.
Still, investors should exercise caution when it comes to NIO shares. Despite surging in recent weeks, the company faces stiff competition domestically and unfavorable tariffs in other parts of the world that are likely to limit its ability to undercut the Model Y from competitor Tesla Inc.&nbsp;with its new affordable ONVO L60 offering.
<h2>TME: Earnings and Cash Flow Growth</h2>
Tencent Music Entertainment Group (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/tme#NYSE">TME</a>), the online music and entertainment streaming platform provider, has massive earnings growth potential. Analysts project 27.4% earnings growth this year, far ahead of the wider industry.&nbsp;The company already posted a 33.1% year-over-year improvement in net profit&nbsp;in the latest quarter, driven by an increase in online music subscribers and improved retention rates.
Tencent has coupled this rapid bottom-line growth with steady improvement in cash flow as well, allowing the company to sustainably expand its operations. If China&#39;s stimulus program is effective at boosting consumer spending, Tencent is likely to be a major recipient.
<h2>MCHI: Broad Market Coverage and Attractive Liquidity</h2>
Investors looking to lean toward Chinese equities more broadly and without focusing on a single firm may look to the iShares MSCI China ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/mchi#NASDAQ">MCHI</a>). This fund provides wide exposure to nearly 600 large-cap Chinese firms.
While it is not the cheapest broad-based China-focused ETF based on expense ratio, it provides superior liquidity and a strong asset base relative to some of its less-expensive competitors.
MCHI is up by more than a third in the last year, sharply outpacing the CSI 300 during that same period.
<h2>Impact of Additional Stimulus Measures</h2>
China&#39;s government spending is currently below budget&nbsp;due to minimal capital investment projects and a lack of government revenue. In response, the government is&nbsp;reportedly considering issuing about $284 billion in special sovereign bonds in the coming weeks. This would likely further boost the Chinese economy, particularly in&nbsp;household consumption and at the local government level.
In the meantime, China&#39;s economy is not out of trouble just yet. Investors should be cautious about the rapid uptick in many Chinese equities and keep in mind that the rally may be short-lived. Still, some individual companies&mdash;and even the broader Chinese market&mdash;may still offer room for growth. Indeed, some non-Chinese companies also stand to benefit from a continued rally thanks to this stimulus package.
The article &quot;<a href="https://www.marketbeat.com/stock-ideas/key-stocks-to-ride-chinas-stimulus-driven-growth/">3 Key Stocks to Ride China&#39;s Stimulus-Driven Growth</a>&quot; first appeared on MarketBeat.

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3 Key Stocks to Ride China's Stimulus-Driven Growth

The Chinese market, which reopened on Tuesday after a weeklong public holiday, was pressured on Wednesday as domestic traders did not get the additional stimulus they had factored in. Come Thursday, things took a turn for the better as the People&#8217;s Bank of China announced measures to boost the stability of the domestic equity market.
What Happened: In a statement released on its website, the PBoC said it has decided to establish the &#8220;Securities, Funds and Insurance Companies Swap Facility,&#8221; or SFISF, to support qualified securities, funds and insurance companies to exchange bonds, stock exchange-traded funds and CSI 300 constituent stocks and other assets for high-grade liquid assets such as Treasury bonds and central bank bills from the central bank. 
The scale of operation during the first phase is 500 billion yuan ($70.7 billion) and this could be expanded further depending on the situation, the central bank said. Applications from qualified securities, funds and insurance companies will be accepted with immediate effect, it said.
The central bank clarified that the new measure is in order to implement the requirements of the Third Plenary Session of the 20th CPC Central Committee regarding &#8220;establishing a long-term mechanism to enhance the inherent stability of the capital market&#8221; and promote the healthy and stable development of the capital market.&#8221;
See Also: <a href="https://www.benzinga.com/money/best-chinese-stocks">Best Chinese Stocks</a>
Thursday&#8217;s announcement comes on top of the liquidity-boosting measures the central bank announced in late September regarding cutting the reserve requirement ratio, which is the amount of cash banks must hold as reserves, by 50 basis points freeing up about 1 trillion yuan for new lending.
The central bank hinted at the possibility of reducing it by a further 0.25-0.50% points. It also said it would lower the seven-day repo rate by 0.2 points, the interest rate on a medium-term lending facility by about 30 basis points and loan prime rates by 20-25 basis points.
Market Reacts: The Shanghai Composite Index &#8211; the key market gauge of mainland China, rallied strongly following the fresh stimulus. After opening at 3,277.69, modestly higher than the previous close of 3,258.86, the index gave back its gains in early trading and moved below the unchanged line.
Following PBoC&#8217;s announcement, the index recovered. At last check, it traded 2.92% higher at 3,353.91.
Hong Kong&#8217;s Hang Seng Index also rallied over 4%.
US-listed Stocks Rip Higher: U.S.-listed Chinese stocks listed in Hong Kong reflected the buoyancy and were sharply higher by mid-day on Thursday. Among the gainers are:
<ul>
<li>Alibaba Group Holding Limited (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BABA#NYSE">BABA</a>) gained 4.28%.</li>
<li>XPeng, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XPEV#NYSE">XPEV</a>) jumped 9.50%.</li>
<li>Li Auto, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/LI#NASDAQ">LI</a>) rose 5.96%.</li>
<li>Nio, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/NIO#NYSE">NIO</a>) added 6%.</li>
<li>JD.com, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/JD#NASDAQ">JD</a>) climbed 5.63%.</li>
<li>Tencent Holdings Ltd. (OTC:<a class="ticker" href="https://www.benzinga.com/stock/TCEHY#OTC">TCEHY</a>) moved up 1.98%.</li>
<li>Baidu, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/BIDU#NASDAQ">BIDU</a>) moved up 2.47%.</li>
</ul>
The iShares MSCI China ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MCHI#NASDAQ">MCHI</a>) ended Wednesday&#8217;s session down 2.36% at $51.97, according to <a href="https://benzinga.grsm.io/register174">Benzinga Pro data.</a>
Read Next:
<ul>
<li><a href="https://www.benzinga.com/markets/equities/24/10/41182930/china-was-tipping-into-a-japan-style-lost-decade-of-deflation-and-stagnation-before-late-septemb">China Was Tipping Into A Japan-Style &#8216;Lost Decade&#8217; Of Deflation And Stagnation Before Late-September Stimulus Announcements, Says Legal Expert</a></li>
</ul>
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