Group 1 - The recent performance of A-shares is driven by multiple economic stabilization policies, improved valuations, and positive earnings expectations for listed companies [1] - Various policies implemented by the Chinese government aim to curb excessive competition, which is expected to enhance corporate profit margins and improve the overall economic fundamentals [3] - The Chinese government has introduced over 50 measures across 16 industries to promote sustainable industry development and stronger corporate earnings [5] Group 2 - The valuation of major assets in the Chinese stock market remains low compared to historical levels, making A-share blue-chip stocks more cost-effective relative to high P/E ratios of large-cap tech companies in the US [7] - The dynamic P/E ratio of the S&P 500 is around 22 times, while the MSCI China Index is approximately 12 times, and A-shares are slightly higher at around 13 times, indicating that they are not overly expensive even after recent gains [9] - The outlook for Chinese securities is positive due to potential foreign capital inflows, stabilization of international geopolitical risks and tariff issues, and supply-side reforms targeting excessive competition [11]

May 28, 2025 05:10 PM GMT China's 3D Journey - China Musings | Asia Pacific Is China Rebalancing? Not yet. The latest car price competition underscores how supply-demand imbalance continues to fuel deflation. There is growing rhetoric about the need for rebalancing, but recent developments suggest the old supply-driven model remains intact. Thus, reflation is likely to remain elusive. Since late last year, policymakers and official media have been creating an atmosphere of public opinion that opposes "invol ...