Blackrock's research arm turns overweight Chinese stocks on stimulus hopes
LONDON, Oct 1 (Reuters) -Blackrock's research arm on Tuesday became more upbeat on Chinese stocks, moving to an "overweight" rating as investors brace for a potentially large fiscal stimulus.
"We are modestly overweight," said Blackrock Investment Institute (BII) analysts, including Wei Li, in a research note.
"Major fiscal stimulus may be coming and prompt investors to step in given Chinese stocks are at a deep discount to DM (developed market) shares."
"We stay nimble and could change our view if the stimulus details disappoint or a ratcheting up of trade restrictions appears likely," it said.
Chinese leaders pledged last week to deploy "necessary fiscal spending" to meet this year's economic growth target of roughly 5%, and Reuters reported that Beijing plans to issue sovereign bonds worth about 2 trillion yuan ($284 billion) this year, in part to subsidise consumer goods purchases and child support.
The $10 trillion asset manager's research arm had previously held a "neutral" rating on Chinese stocks.
Reporting by Harry Robertson, editing by Alun John
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