Arab Press

بالشعب و للشعب
Friday, Aug 22, 2025

Tech might help sustain shares in fourth quarter

Tech might help sustain shares in fourth quarter

Technology shares may lead Chinese equities higher to stand out among global financial assets in the fourth quarter, but uncertainties surrounding trade tensions with the United States may complicate any potential uptrend, analysts said.
"We continue to believe that emerging market equities in general are relatively attractive investments and that leading EM equities will be Chinese equities," said Daniel Gerard, senior multi-asset strategist at State Street Global Markets, a US-based global investment research and trading services provider.

"We expect a positive fourth quarter for China's A shares with a caveat," Gerard said. His forecast is predicated on further economic stimulus from Beijing, progress toward a Sino-US tariff resolution and global central banks' coordinated liquidity support that will manage to assuage any slowdown.

The caveat of this forecast mainly derives from possible twists and turns in the resolution of trade tensions, he said.

Technology firms have the potential of being outperformers among A shares given the sector's long-run strong prospects amid China's economic upgrading, Gerard said.

Near-term downside sector risks stemming from US tariffs and slower global growth, however, should be watched, he added.

Valuations of technology shares related to 5G infrastructure and consumer electronics are still "reasonable", considering the two sectors' foreseeable earnings growth over the next two years, said a Beijing-based portfolio manager who declined to be named.

Further monetary easing could be expected over the rest of the year, which will boost risk appetite and benefit high-growth tech firms, he said, adding that the opportunity window for adding exposure to the two sectors should open if the market sees downward adjustment.

During the July-September period, the Shenzhen, Guangdong province-based ChiNext — which is heavy with innovative and growth enterprises — rose 7.68 percent to 1,627.55 points, with subindexes tracking sectors of semiconductor and electronics rising 20 percent and 16 percent, respectively, according to financial information provider Wind Info.

Over the same period, the benchmark Shanghai Composite Index fell 2.47 percent to 2,905.19 points, after retreating from a 11-week intraday high on Sept 16.

The market retreat in late September partly reflected mild disappointment over cautious easing measures by the People's Bank of China, the central bank, and investors cutting exposure before the long National Day holiday, said Wendy Liu, head of China Strategy at UBS Investment Research.

Looking at the fourth quarter, investors are hopeful that the new lending reference rate will continue to decrease, which should help repair margins and potentially restore valuations of some stocks that face large interest expense payments, Liu said.

As the market reopens on Tuesday, investors will grapple with fluctuations in overseas stock markets over the holiday and await progress in upcoming Sino-US trade talks and third-quarter earnings results.

Recent overseas fluctuations are not likely to exert a major impact on A shares as the slide of US stocks was limited, said Ricky Zhong, a fund manager at iMeigu Capital Management.

US stocks tumbled in the first two trading days of October amid recession concerns and trade tensions between the US and the European Union. The market recovered later, with the S&P 500 ending the week 0.33 percent lower at 2,952.01 points.

Vice-Premier Liu He is about to lead the Chinese delegation to Washington for the 13th round of the China-US high-level economic and trade consultations in the week following the National Day holiday, according to the Ministry of Commerce.

Ahead of the resumption of trade talks, the US administration was reported by Bloomberg to be considering policies restricting portfolio investment in Chinese equities. White House trade adviser Peter Navarro told CNBC on Sept 30 that over half of the report "was highly inaccurate or simply flat-out false".

Such restrictions, if taken, may weigh on A-share investor sentiment in the short term but are not likely to cause any major disruptions considering the limited US holdings in A-share assets, said Dong Dengxin, director of Wuhan University of Science and Technology's Finance and Securities Institute.
Newsletter

Related Articles

Arab Press
0:00
0:00
Close
Dogfights in the Skies: Airbus on Track to Overtake Boeing and Claim Aviation Supremacy
Tim Cook Promises an AI Revolution at Apple: "One of the Most Significant Technologies of Our Generation"
Are AI Data Centres the Infrastructure of the Future or the Next Crisis?
Miles Worth Billions: How Airlines Generate Huge Profits
Zelenskyy Returns to White House Flanked by European Allies as Trump Pressures Land-Swap Deal with Putin
Beijing is moving into gold and other assets, diversifying away from the dollar
Trump Backs Putin’s Land-for-Peace Proposal Amid Kyiv’s Rejection
Zelenskyy to Visit Washington after Trump–Putin Summit Yields No Agreement
Iranian Protection Offers Chinese Vehicle Shipments a Cost Advantage over Japanese and Korean Makers
United States Sells Luxury Yacht Amadea, Valued at Approximately $325 Million, in First Sale of a Seized Russian Yacht Since the Invasion of Ukraine
Saudi Arabia accelerates renewables to curb domestic oil use
Cristiano Ronaldo and Georgina Rodríguez announce engagement
Asia-Pacific dominates world’s busiest flight routes, with South Korea’s Jeju–Seoul corridor leading global rankings
Private Welsh island with 19th-century fort listed for sale at over £3 million
Sam Altman challenges Elon Musk with plans for Neuralink rival
Australia to Recognize the State of Palestine at UN Assembly
The Collapse of the Programmer Dream: AI Experts Now the Real High-Earners
Armenia and Azerbaijan to Sign US-Brokered Framework Agreement for Nakhchivan Corridor
British Labour Government Utilizes Counter-Terrorism Tools for Social Media Monitoring Against Legitimate Critics
WhatsApp Deletes 6.8 Million Scam Accounts Amid Rising Global Fraud
Texas Residents Face Water Restrictions While AI Data Centers Consume Millions of Gallons
India Rejects U.S. Tariff Threat, Defends Russian Oil Purchases
United States Establishes Strategic Bitcoin Reserve and Digital Asset Stockpile
Thousands of Private ChatGPT Conversations Accidentally Indexed by Google
China Tightens Mineral Controls, Curtailing Critical Inputs for Western Defence Contractors
JPMorgan and Coinbase Unveil Partnership to Let Chase Cardholders Buy Crypto Directly
British Tourist Dies Following Hair Transplant in Turkey, Police Investigate
WhatsApp Users Targeted in New Scam Involving Account Takeovers
Trump Deploys Nuclear Submarines After Threats from Former Russian President Medvedev
Germany’s Economic Breakdown and the Return of Militarization: From Industrial Collapse to a New Offensive Strategy
Germany Enters Fiscal Crisis as Cabinet Approves €174 Billion in New Debt
IMF Upgrades Global Growth Forecast as Weaker Dollar Supports Outlook
Politics is a good business: Barack Obama’s Reported Net Worth Growth, 1990–2025
UN's Top Court Declares Environmental Protection a Legal Obligation Under International Law
"Crazy Thing": OpenAI's Sam Altman Warns Of AI Voice Fraud Crisis In Banking
Japanese Prime Minister Vows to Stay After Coalition Loses Upper House Majority
President Trump Diagnosed with Chronic Venous Insufficiency After Leg Swelling
Man Dies After Being Pulled Into MRI Machine Due to Metal Chain in New York Clinic
FIFA Pressured to Rethink World Cup Calendar Due to Climate Change
Iranian President Reportedly Injured During Israeli Strike on Secret Facility
Kurdistan Workers Party Takes Symbolic Step Towards Peace in Northern Iraq
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
AI Raises Alarms Over Long-Term Job Security
Russia Formally Recognizes Taliban Government in Afghanistan
Saudi Arabia Maintains Ties with Iran Despite Israel Conflict
Mediators Edge Closer to Israel-Hamas Ceasefire Agreement
Germany Seeks Taliban Deal to Deport Afghan Migrants
Emirates Airline Expands Market Share with New $20 Million Campaign
Robots Compete in Football Tournament in China Amid Injuries
×