Money pulled from China finds way to Asean countries, not India

Global brokerages cut China exposure, keep the status quo on India & turn bullish on Indonesia

The outbreak of the Omicron variant of the coronavirus and unprecedented lockdowns in China have roiled its equity market and also that of Hong Kong. After the crisis-hit Sri Lanka, China and Hong Kong are the worst-performing stock markets in Asia on a year-to-date basis. 

Most global brokerages had China as their biggest overweight in the Asia Pacific ex-Japan portfolio. But given the turmoil in the world’s second-largest economy, most strategists have started to reduce their overweight position on China, in favour of Asean countries — such as Indonesia, Singapore, and Malaysia — which are seen benefitting from the surge