Global Funds Are Fleeing China Stocks in Record Selling Streak

(Bloomberg) — Daily outflows of overseas funds from Chinese stocks tied a record streak amid worsening sentiment on the nation’s economy and the government’s efforts to get it back on track.

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Foreign investors shed another 1.5 billion yuan ($208 million) worth of equities listed in Shanghai and Shenzhen via the trading link Thursday, in the ninth-straight day of outflows. That ties the longest stretch of net selling since just after Bloomberg began tracking the data in December 2016.

Overseas traders have sold 46.2 billion yuan of mainland China stocks over the latest nine sessions, nearly wiping out their recent buying spree amid hopes for new government measures after the key Politburo meeting. Lack of concrete policy action, weak economic data and fears of contagion from property-sector woes have sparked the renewed selloff in Chinese equities.

China Markets Approach Grim Milestones as Selloff Spirals

“Overseas investors are lowering their expectations for growth,” after recent data and amid “restrained” moves by the government to contain the property crisis, said Meng Lei, China strategist at UBS Securities.

Meng maintains an estimate for total foreign inflow of 300 billion yuan this year. However, forceful and timely moves to loosen restrictions on buying property and offer fiscal support may be needed to drive inflows, he added.

(Updates figures throughout)

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