Xinhua News Media Of China Concept Stocks Is Rising Brightly

The East is not bright, the west is bright.

By the end of October 12th, the Xinhua news media of China's concept stocks reached 19%.

The US economy is weak. Why is China's stock market full of momentum? Liu Feng, manager of Strategy Department of Zhongyuan Securities Research Institute, said in an interview with "international finance daily" that "the trend of China's concept stocks is not a sudden phenomenon. The Chinese concept stock" green "is naturally" green "reasonable.

"Chinese concept" and "green" are reasonable.

Liu Feng pointed out to reporters that the Chinese concept stocks "go green" the three major driving forces: first, European and American investors are still optimistic about China's economic development. Despite the fact that China's economic growth in 2011 is more or less a bit of a problem, its overall economic weakness is far lower than that of Europe and the US. The annual growth rate of China's economy has not been particularly suspense in 9%.

Second, in the past, China's stock market in the US stock market was generally low, and some even had only a few dozen cents.

However, Baidu's latest stock price is as high as 99.66 dollars, and the New Oriental stock price also reaches US $89.62. Stock prices of SouFun, Sohu, Sina, home express and so on are over 50 US dollars.

Liu Feng pointed out that "Baidu's market capitalization has now reached 34 billion 653 million US dollars, which is easy to be sought after by institutional funds, which provides higher liquidity for international capital."

Of course, the trend of RMB appreciation has also become a major reason for international funds to pursue China's concept stocks.

Liu Feng pointed out that international fund managers are optimistic about China's concept stocks and are optimistic about the next 10 to 15 years. The status of the renminbi will continue to rise and is close to the international reserve currency status.

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IPO growth of Chinese enterprises in the US

The Chinese stock market has been touted in the US market, and Chinese enterprises have also been touted by US investors for their IPO in the US.

The international finance daily learned from Merrill Lynch and Bank of America that in the third quarter, the investment bank helped 5 Chinese companies to list in the United States in 5 days.

Among them, the Chinese fast food chain restaurant based on the New York Stock Exchange initial public offerings, raising $95 million, due to strong market reaction, its price rose from 12 to 14 U.S. dollars per share range to 14 to 16 U.S. dollars, the final price of the paction is 16.5 US dollars higher than the revised price range.

In the first day of trading, its share price rose by 47%.

"International investors are very keen on Chinese consumer related companies and have strong interests. They are eager to invest directly in China's domestic demand market and profit from it."

A person close to the underwriting side told reporters, "liquidity in the market is still abundant.

The risk reward status of consumer goods companies in China is very attractive and can benefit from the wealth growth of China's middle class.

American investors are willing to pay a risk premium for enterprises with clear management and good performance to seize China's growth opportunities.

According to data from financial data provider Dealogic, at least 16 Chinese companies have registered with the securities and Exchange Commission. It is expected to land in the US market for IPO in the next 180 days, and the scale of financing will reach about $590 million.

"Chinese companies are doing well, and international investors in the United States are looking for a high Growth Company with a high profit margin and a clear business model," said Nick Einhorn, an analyst at IPO research company Renaissance Capital in Connecticut.

Therefore, the trend of Chinese enterprises going to the US IPO will continue.

"Chinese style" is not stopping for a while.

How long will the Chinese wind continue in Wall Street? For this reason, Liu Feng told reporters, "whether China's popularity in the US stock market will continue depends on two conditions. First, China's economy has maintained a relatively fast growth rate. The second is that the loose monetary policy in Europe and the United States has not changed and the market has plenty of liquidity.

As long as these two conditions have not been changed, the Chinese concept stocks will continue to be popular in the US market and enjoy more premiums.

Of course, the operation of China's concept stocks will still be restricted by systemic risks in the US stock market, but Liu Feng believes that the upward trend of China's concept stocks is much larger than that of the US stock market.

"As an emerging market, China's assets are high risk and high yield in the eyes of these US investors, so the elasticity of these stocks will be much greater than that of local stocks."

Liu Feng added that "in terms of China's domestic and global economic operation situation, China's concept stocks are still in the upward process in the US market."

In view of this, the "Chinese style" of the US stock market will continue.