With the U.S.-China trade war flaring up, some strategists at JPMorgan have lowering their recommendation on Chinese stocks to neutral from overweight.
With the two nations slapping tariffs on goods imported from each other, Chinese manufacturers’ profit margins might be getting hurt – something that's a potential headwind for the nation’s investment and growth. In the latest round of the tariff battle, U.S. President Donald Trump imposed a 10 percent tariff on an additional $200 billion of Chinese goods, to which the Chinese government responded with levies on $60 billion of U.S. products.
JPMorgan reduced its target and earnings estimates for the MSCI China Index, but the strategists still expect the index to rebound to 85 points by the end of the year. So far, the index is down -24% from its January high.
Earlier this year, Morgan Stanley, Nomura Holdings Inc. and Jefferies Group also turned cautious about Chinese stocks.
The Moving Average Convergence Divergence (MACD) for MCHI turned positive on April 23, 2024. Looking at past instances where MCHI's MACD turned positive, the stock continued to rise in of 52 cases over the following month. The odds of a continued upward trend are .
The Momentum Indicator moved above the 0 level on April 22, 2024. You may want to consider a long position or call options on MCHI as a result. In of 93 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
MCHI moved above its 50-day moving average on April 22, 2024 date and that indicates a change from a downward trend to an upward trend.
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where MCHI advanced for three days, in of 272 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Stochastic Oscillator entered the overbought zone. Expect a price pull-back in the foreseeable future.
MCHI broke above its upper Bollinger Band on April 24, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Aroon Indicator for MCHI entered a downward trend on April 18, 2024. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
Category PacificAsiaexJapanStk