As inflation fears intensify, countries around the world are aggressively raising interest rates and withdrawing fiscal stimulus measures. At the same time, Goldman Sachs Group believes that China's policy has a positive momentum of relaxation compared with the rest of the world, so Goldman Sachs Group holds a constructive view on Chinese stocks.

Goldman Sachs Group analyst Kinger Lau pointed out in the latest report that as the impact of the epidemic fades, China's economic growth momentum is expected to begin to stabilize in the coming quarters.

In addition, Goldman Sachs Group said that as regulatory and overseas listing and capital financing policies become clearer, Chinese internet stocks will be able to further revalue and narrow the gap between fair value and existing valuations.

It is worth mentioning that overseas investor sentiment has also improved significantly.As Chinese stocks rebounded rapidly, overseas investors flocked to the bottom to snap up the Chinese stock ETF.

According to previous articles on Wall Street, investors invested nearly $270 million in ETF (MCHI) issued by Blackrock's iShares Asustek last Tuesday, the highest one-day inflow since the fund was founded in 2011. It is reported that MCHI is the largest overseas Chinese stock ETF, which tracks the MSCI China Index.

Some analysts believe that Chinese Internet stocks have built a high risk premium. Charlie Wilson, who manages $1.1 billion in emerging market equities at Thornburg Investment Management, says he himself is overweight in Chinese stocks. He said:

The valuations of China's big technology stocks have fallen to their lowest level in more than a decade, and I don't think these companies will disappear.

Goldman Sachs Group has previously maintained an overmatched view of the Chinese stock market. Goldman Sachs Group believes that the MSCI China index has 20 per cent room to rise in the next 12 months, mainly because of policy support.