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Denis Sergienko • 2022-10-26

Investors’ Fear of Chinese Stock Plunge Can Be Misguided

Investors’ Fear of Chinese Stock Plunge Can Be Misguided

Investors expressed some fear about the Chinese stock market after Xi's leadership team was introduced to the public. It made some biggest market players experience the stock price plunge including such giants as Alibaba.

However, experts say these fears can be misguided. The new government is expected to be focused on rapid economic growth with Li Qiang as new premier. He already has a successful experience in raising several provincial economies.

The Stock Price Plunge

The introduction of the new leadership team presented by Chinese President Xi Jinping made some investors nervous about the future of the Chinese stock market. As a result, even proven giants suffered a stock price plunge. They include such tech internet giants as Alibaba.

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At the same time, experts try to calm investors. These fears can be misguided, as economic-focused development strategies will still be the main priority. New governmental promotions include Li Qiang becoming the new prime minister to improve the situation with a focus on not only the richest provinces but also regions that call for economic improvement as well.

A Plan for the Future

Initially, provinces with top economies were the main priority. Some of the export-heavy regions eventually became partly secretary, for example, Guangdong. At the same time, the new premier has made a name for himself as a good manager of the country’s richest and biggest provincial economies.

Experts say he will become a powerful and capable pro-growth politician. It will definitely strengthen the Chinese position in the global arena. In simpler words, current investors’ fears seem to be misleading. In the near future, we can expect the Chinese stock market to grow. This is a good chance to keep your portfolios well-diversified.