Can Chinese stocks rally before Communist Party congress? Goldman says history may not repeat this year
- Weak economy hobbled by Covid-19 lockdowns may break precedent of market rally in the run up to Communist Party congress
- The MSCI China Index has declined 5.5 per cent in the past month, bringing this year’s slump to 26 per cent

“It is uncertain whether the historical precedents will be valid this time for two main reasons,” analysts including Kinger Lau and Si Fu wrote in reports dated September 18. China’s adherence to the zero-Covid policy could soften the policy easing impulse, while changes to the policy are unlikely to come before April next year, they added.
The MSCI China Index, which tracks 717 stocks with a market capitalisation of US$2.4 trillion, has declined 5.5 per cent over the past month, bringing the losses this year to 26 per cent.
Historically, the index has gained 2 per cent on average one month before the congress, according to data compiled by Goldman. The upside was even more stunning, at 12 per cent, three months before the gathering, partly fuelled by valuation expansion on the back of supportive economic policies and robust growth momentum, the analysts said.
