Analysts see more gains for stocks this year
The benchmark Shanghai Composite Index and the Shenzhen Component Index will continue to rise in 2015 as the central bank will keep reducing financial risks that were overestimated by the market, an investment strategist said on Friday.
"While we expect economic growth to slow marginally in 2015, we believe that the reforms implemented by the government so far have materially reduced the risks of a hard landing due to a disruptive default in either local government investment vehicles or wealth management product areas. This warrants a reduced risk premium on Chinese equities," said Zheng Yudong, head of investment strategy and advisory at Standard Chartered Bank (China) Ltd.
Chinese equities have been cheap for some time. However, Zheng said in an annual investment outlook report that valuations may increase in 2015 for three reasons:
