China’s stock market was hit by the biggest outflow of foreign capital on record in April and May as the trade war with the US and concerns over the stability of the RMB weighed over investors, reported the Financial Times.
A total of about $12 billion left China’s market during April and May, according to data from CEIC and Morgan Stanley, the largest exodus since the launch five years ago of a “stock connect” program that provides global investors with access to Chinese shares, via Hong Kong.
“Domestic investors [in China] are concerned about whether foreign investors are quitting the market,” said Laura Wang, China equity strategist at Morgan Stanley.
Despite the outflow, China still has a net inflow of about $8 billion this year thanks to a strong market performance in Q1.