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BIZCHINA / News
JP Morgan: QDII to reach US$90b next year
By Ding Qi (Chinadaily.com.cn)
Updated: 2007-08-08 08:39
The investment quota for Qualified Domestic Institutional Investors
(QDII) will reach US$90 billion next year, but huge overseas investments
won't dampen domestic markets, Li Jing, general manager and chairman of
the Chinese securities department of JP Morgan Chase, told the China
Securities Journal on Monday.
According to the estimation of JP Morgan, the 90-billion quota will come
from banks, fund management companies, securities companies and insurers.
Related readings:
?China unit of JPMorgan wins QDII nod
?China AMC plans $1.3b QDII fund in Sept
?China authorises 1st JV fund to invest overseas under QDII
?Banks use only 26% of QDII quota in 1st half
?ICBC raises $585m in China's largest QDII fund
Shares of mainland companies listed in the Hong Kong market will benefit
more from the QDII funds in the short term. Stocks with large price
discount from their A-share counterparts or possibility to return to the
mainland market are particularly preferred. From a longer perspective,
however, QDII will appoint experienced overseas fund managers to invest
more in other markets, Li said.
She anticipated that with more QDII funds flowing out, and more Chinese
firms launching IPOs in Hong Kong in the second half of the year, the
price difference between A-shares and H-shares would gradually disappear.
Although the US sub prime loan crisis caused some fluctuations of the
Asian market recently, Li did not believe it would affect the domestic
market since?few banks in China had invested in foreign credit loan
products.
Instead, both the mainland and Hong Kong stock markets will continue to
grow backed by the nation's economic development, according to Li.
The corporate revenue will keep growing, and huge funds are flowing from
the banks to the stocks market, which may serve as driving force of the
stock prices. Although a structural adjustment was needed currently to
ensure a sustainable development, the upward trend of the nation's
economy as well as the market would not change, she noted.
(For more biz stories, please visit Industry Updates)
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