Rally in equities round the corner, fund leader says

Equities in China, on pace for their best quarterly gain in a year, are still in the "early" stages of a rally, according to Michael Shaoul, chairman and chief executive officer of Marketfield Asset Management LLC.

Marketfield, which manages $18.5 billion, is bullish on Chinese equities amid optimism the government will take more steps to boost Asia's biggest economy, Shaoul said. President Xi Jinping is trying to avoid a slowdown in output as he seeks to increase the contribution from services to growth, while reducing reliance on the credit-driven construction that has propelled expansion in the past.

"We would expect to see the government and the central bank bring in stimulus measures favoring State-owned enterprises, which is quite bullish," Shaoul said by phone from New York on Wednesday. "What they don't seem to want to do is to re-stimulate real estate itself. You might even start to see retail money redirected to equities after years of chasing real estate."