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How Will China ETFs React to the Latest Exports Data?
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The world’s second-largest economy is on the path of recovery from the pandemic-driven slump. China’s exports climbed 27.9% year over year in May, in comparison with the 32.3% rise recorded in April. Meanwhile, imports rose 51.1% year over year in May versus a rise of 43.1% in April. Notably, analysts had expected a year-over-year increase of 32.1% for exports and a rise of 51.5% for imports in the same period, per a Reuters’ poll.
Notably, trade surplus in May came in at $45.53 billion in comparison to analyst expectation of $50.50 billion, per a Reuters’ poll. It compares favorably with a $42.86-billion surplus in April.
Notably, China’s trade surplus with the United States climbed 14% to $31.8 billion for May, per a Financial Express article. Going on, the trade surplus with the European Union declined 43% to $12.7 billion.
Commenting on the data, Capital Economics said that "We think that trade volumes, which are well above their pre-virus trend, will drop back over the coming quarters. Admittedly, supply constraints should start to ease later this year. But the pandemic-induced surge in demand for Chinese exports appears to be losing momentum and should reverse as global consumption patterns normalise on the back of vaccine rollouts and easing social distancing restrictions.”
China has witnessed strength in the export levels from strong global demand for coronavirus outbreak-related goods while other countries were mostly struggling with the pandemic. According to analysts, the reason behind May’s export numbers lagging analysts’ estimates could be the delays experienced at ports in southern China from rising precautions to combat the coronavirus outbreak, per a Financial Express article. Notably, the port stands to be the main shipping hub for China.
The world’s second-largest economy’s timely control of coronavirus outbreak in the previous year helped its factories tap the global demand, per a Bloomberg article.
However, analysts are of the opinion that the constrained supplies of semiconductors have dented export levels for electronic items, per a Financial Express article. Moreover, demand for items like toys and furniture is softening as the social-distancing norms are being eased. Meanwhile, the spike in import levels can be attributed to rising raw material demand by factories to meet export orders as well as rising prices of oil and several other commodities, according to a Financial Express article.
China ETFs to Watch Out For
Against this backdrop, investors can keep a tab on a few China ETFs like iShares MSCI China ETF (MCHI - Free Report) , iShares China Large-Cap ETF (FXI - Free Report) , Xtrackers Harvest CSI 300 China A-Shares ETF (ASHR - Free Report) , SPDR S&P China ETF (GXC - Free Report) , iShares MSCI China A ETF (CNYA - Free Report) and Invesco Golden Dragon China ETF (PGJ - Free Report) .
This fund seeks long-term growth by tracking the investment returns, before fees and expenses, of the FTSE China 50 Index. It comprises 50 holdings. The fund’s AUM is $5 billion and expense ratio is 0.74%.
ASHR
This fund tracks the CSI 300 Index. It comprises 296 holdings. The fund’s AUM is $2.81 billion and expense ratio is 0.65%.
GXC
The fund seeks to provide investment results that, before fees and expenses, correspond generally to the total return performance of the S&P China BMI Index. It comprises 819 holdings. The fund’s AUM is $1.94 billion and expense ratio is 0.59% (read: Alibaba Solid Fiscal Q3 Earnings Put These ETFs in Focus).
CNYA
The fund tracks the MSCI China A Inclusion Index. It comprises 490 holdings. The fund’s AUM is $701.5 million and expense ratio is 0.60%.
PGJ
This fund follows the NASDAQ Golden Dragon China Index, which offers exposure to the U.S. exchange-listed companies headquartered or incorporated in the People’s Republic of China. It holds a basket of 86 stocks. The product has AUM of $262.3 million and charges 70 basis points in annual fees.
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How Will China ETFs React to the Latest Exports Data?
The world’s second-largest economy is on the path of recovery from the pandemic-driven slump. China’s exports climbed 27.9% year over year in May, in comparison with the 32.3% rise recorded in April. Meanwhile, imports rose 51.1% year over year in May versus a rise of 43.1% in April. Notably, analysts had expected a year-over-year increase of 32.1% for exports and a rise of 51.5% for imports in the same period, per a Reuters’ poll.
Notably, trade surplus in May came in at $45.53 billion in comparison to analyst expectation of $50.50 billion, per a Reuters’ poll. It compares favorably with a $42.86-billion surplus in April.
Notably, China’s trade surplus with the United States climbed 14% to $31.8 billion for May, per a Financial Express article. Going on, the trade surplus with the European Union declined 43% to $12.7 billion.
Commenting on the data, Capital Economics said that "We think that trade volumes, which are well above their pre-virus trend, will drop back over the coming quarters. Admittedly, supply constraints should start to ease later this year. But the pandemic-induced surge in demand for Chinese exports appears to be losing momentum and should reverse as global consumption patterns normalise on the back of vaccine rollouts and easing social distancing restrictions.”
China has witnessed strength in the export levels from strong global demand for coronavirus outbreak-related goods while other countries were mostly struggling with the pandemic. According to analysts, the reason behind May’s export numbers lagging analysts’ estimates could be the delays experienced at ports in southern China from rising precautions to combat the coronavirus outbreak, per a Financial Express article. Notably, the port stands to be the main shipping hub for China.
The world’s second-largest economy’s timely control of coronavirus outbreak in the previous year helped its factories tap the global demand, per a Bloomberg article.
However, analysts are of the opinion that the constrained supplies of semiconductors have dented export levels for electronic items, per a Financial Express article. Moreover, demand for items like toys and furniture is softening as the social-distancing norms are being eased. Meanwhile, the spike in import levels can be attributed to rising raw material demand by factories to meet export orders as well as rising prices of oil and several other commodities, according to a Financial Express article.
China ETFs to Watch Out For
Against this backdrop, investors can keep a tab on a few China ETFs like iShares MSCI China ETF (MCHI - Free Report) , iShares China Large-Cap ETF (FXI - Free Report) , Xtrackers Harvest CSI 300 China A-Shares ETF (ASHR - Free Report) , SPDR S&P China ETF (GXC - Free Report) , iShares MSCI China A ETF (CNYA - Free Report) and Invesco Golden Dragon China ETF (PGJ - Free Report) .
MCHI
This fund tracks the MSCI China Index. It comprises 609 holdings. The fund’s AUM is $7.38 billion and expense ratio is 0.59% (read: China ETFs Ruling 52-Week High Chart on Impressive GDP Data).
FXI
This fund seeks long-term growth by tracking the investment returns, before fees and expenses, of the FTSE China 50 Index. It comprises 50 holdings. The fund’s AUM is $5 billion and expense ratio is 0.74%.
ASHR
This fund tracks the CSI 300 Index. It comprises 296 holdings. The fund’s AUM is $2.81 billion and expense ratio is 0.65%.
GXC
The fund seeks to provide investment results that, before fees and expenses, correspond generally to the total return performance of the S&P China BMI Index. It comprises 819 holdings. The fund’s AUM is $1.94 billion and expense ratio is 0.59% (read: Alibaba Solid Fiscal Q3 Earnings Put These ETFs in Focus).
CNYA
The fund tracks the MSCI China A Inclusion Index. It comprises 490 holdings. The fund’s AUM is $701.5 million and expense ratio is 0.60%.
PGJ
This fund follows the NASDAQ Golden Dragon China Index, which offers exposure to the U.S. exchange-listed companies headquartered or incorporated in the People’s Republic of China. It holds a basket of 86 stocks. The product has AUM of $262.3 million and charges 70 basis points in annual fees.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>