Fed Rate Cut Spurs Investor Interest in Asian Stocks; Chinese Markets Show Resilience

The Federal Reserve's recent rate cut to 4.75%-5% could fuel global investors' interest in Asian stocks. Over 5,300 Chinese companies reported a year-on-year revenue increase, with 4,100 showing positive net profits. E Fund, China's leading mutual fund, saw significant inflows and impressive returns due to their ETF portfolio.

The Federal Reserve's decision on September 18th to cut its benchmark policy rate by 50 basis points could potentially boost international investors' interest in Asian stocks. As the U.S. reduces rates to a range of 4.75% to 5%, the fundamentals of the Chinese economy remain strong.

According to the China Association for Public Companies, over 5,300 A-share listed firms filed their semi-annual reports for 2024 by August 31st. Impressively, more than 3,000 of these companies reported a year-on-year increase in revenue, while over 4,100 revealed positive net profits, representing 78% of the companies.

As Chinese firms impress with their earnings, commitment to consistent dividend distributions is becoming more evident. More than 600 firms have announced potential interim dividends this year—significantly up from less than 200 in 2023. E Fund Management has emerged as one of the major beneficiaries, with net inflows of approximately US$ 100 billion due to its robust ETF portfolio and superior management strategies.