Goldman says China funds to buy US$110 billion of Hong Kong-listed stocks
Southbound inflows have reached US$78 billion this year, surpassing annual net purchases for most years, except in 2020 and 2024: Goldman
Goldman Sachs raised its forecast for investment by mainland Chinese in Hong Kong-listed stocks by almost 50 per cent, following the strongest start to the year on record in terms of Stock Connect fund inflows.
Net southbound inflows could reach US$110 billion this year, versus a previous forecast of US$75 billion, the Wall Street investment bank said in a report on Sunday, citing expectations of increased capital moving into Hong Kong amid concerns about US-China financial decoupling.
These inflows reached US$78 billion so far this year through April, Goldman estimated, including record one-day net purchases of HK$35.6 billion (US$4.6 billion) on April 9. Total inflows this year have surpassed full-year volume in most years, apart from 2020 and 2024, it added.
“[The] buying of domestic institutional investors could be the major contributor to the year-to-date southbound inflows,” Goldman said.
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As foreign capital leaves China to avoid regulatory and geopolitical risks stemming from a tariff war, mainland Chinese investors have continued to expand their cross-border asset allocations for higher returns in Hong Kong, and to protect their investments from yuan depreciation, it added.