On September 26th, Beijing time, the CPC Central Political Bureau held a meeting to analyze and study the current economic situation, and deploy the next economic work. The meeting emphasized the need to focus on key issues, take initiative, effectively implement existing policies, intensify the introduction of new policies, further enhance the targeted and effective measures, and strive to achieve the annual economic and social development goals.

Thanks to the release of a series of major positive policies, the A-share market soared again on Thursday, with all three major indexes rising by over 3%. The Shanghai Composite Index has returned to above 3000 points, and the annual K-line has turned positive.

In overseas markets, Chinese concept stocks surged across the board. The Nasdaq Chinese Golden Dragon Index rose nearly 11% on Thursday, marking the largest intraday increase since March 2022 and the offshore Renminbi briefly rose above the 7 level against the US dollar.

With China releasing an unexpectedly strong policy combination this week, foreign institutions are adjusting their views on Chinese assets.

Goldman Sachs: The China CSI 300 Index may have about 10% upside potential in the short term

Morgan Stanley believes that, from a technical perspective, the China CSI 300 Index may still have around 10% upside potential in the short term.

Morgan Stanley strategist Laura Wang released a report on Thursday, stating that this forecast is based on the bank's analysis of China's relending plan borrowing cost (2.25%) and the current dividend yield of the CSI 300 Index (2.46%).

Morgan Stanley stated that both the political conference and the stimulus plans announced by the central bank and other regulatory institutions earlier this week are very positive.

They added that what truly surprised the market are the unprecedented stability measures, emphasizing the importance of swift follow-up, clear execution details, and timelines. The Chinese stock market saw its best week in a decade thanks to political commitments.

Goldman Sachs: After the US election, the Chinese stock market should be a key investment focus.

Goldman Sachs Global Markets Director and Strategy Expert Scott Rubner stated on Thursday that the recent performance of the Chinese stock market has been strong, with the Nasdaq Golden Dragon Index soaring 19% in the past four days. Once the US election ends, the Chinese stock market should be an important part of investors' investment plans.

Rubner believes that the long-awaited recovery of the Chinese stock market may finally be here, and if so, investors should look to participate. In a report to clients on Thursday, he wrote, "I really think this time is different for China."

Rubner stated, "The resurrected market has rapidly become a hot trading target for November and December after the US election." He referred to the demand for call options expiring at the end of the year.

Goldman Sachs stated that before the recent uptrend, hedge funds had less than 7% of their investments in Chinese stocks, the lowest level in about five years. However, earlier this week, they changed direction and flocked to the Chinese stock market. On Tuesday, they set the largest single-day buying volume since March 2021, also the second-largest single-day net buying volume in the past 10 years.

Rubner wrote, "Chinese and emerging market assets do not benefit from passive fund inflows every day like the US market, but this situation is changing."

$Xtrackers Harvest CSI 300 China A-Shares ETF (ASHR.US)$ Inflows exceeded $17.3 billion on Wednesday, the highest level since June 2022. Rubner expects more funds to flow in.

Hedge fund tycoons: Will buy all Chinese assets

Hedge fund legendary figure David Tepper stated on Thursday that he did not expect such a strong Chinese policy, and he will buy all Chinese assets.

Tepper said in a media interview, "I thought the Fed's rate cut last week would lead to China loosening its policies, but I didn't expect them to make such a significant move. This is a complete turnaround."

When asked what Chinese assets he bought, he replied, "I buy everything, I buy ETFs, I buy futures, I buy them all."

Temper believes that even after the recent surge, there is still a lot of upside potential in the Chinese stock market.

As for whether the re-election of Republican presidential candidate Trump will shake his optimistic view of China, Temper states that this may be irrelevant as there are "internal stimulus" measures.

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