Crazy Friday! Direxion FTSE China Bull 3X ETF surges 15%, A-shares all rise

Pan Gongsheng, Governor of the People's Bank of China, stated at the 2024 Financial Street Forum Annual Meeting that two financial instruments supporting the stable development of the capital market have been established by the People's Bank of China, the China Securities Regulatory Commission, and the China Banking and Insurance Regulatory Commission. Interconnection among securities, funds, and insurance companies has begun accepting applications from financial institutions. The policy documents on stock repurchase and special refinancing for shareholding increase were released and implemented today.

A-shares surged across the board, with the ChiNext Index rising nearly 12% at one point during the day. At the close, the Shanghai Composite Index rose by 2.91%, the Shenzhen Component Index rose by 4.71%, and the ChiNext Index rose by 7.95%. Over 5100 individual stocks in Shanghai, Shenzhen, and Beijing markets rose, with a total turnover exceeding 2.1 trillion yuan.

H-shares also saw significant gains, with the Hang Seng Index closing up by 3.61% and the Hang Seng Tech Index rising by 5.77%. Among the top-traded stocks, SMIC surged by 16.35%, Alibaba by 2.03%, Tencent Holdings by 4.41%, Meituan by 8.93%, and Hong Kong Exchanges and Clearing by 5.67%.

Pre-market trading in U.S. stocks saw a collective rise in Chinese assets, with Pinduoduo and JD.com surging by 5% before the market opened, Alibaba up nearly 4%, and the Direxion FTSE China Bull 3X ETF (YINN) surging by over 14%:

The Direxion FTSE China Bear 3X ETF (YANG) plummeted by over 14%.

Bridgewater: Continue to increase holdings in Chinese assets, valuations remain attractive after the rebound!

Bridgewater, a globally renowned hedge fund, has seen its domestic China fund's return rate climb to 31% in the first three quarters of this year, further bolstering its confidence in the Chinese market.

In its third-quarter investor letter, Bridgewater emphasized that despite the rebound in the Chinese stock market, stock prices remain relatively low compared to profit prospects. The fund will continue to moderately increase holdings in Chinese stocks, be long on bonds, and maintain a neutral stance on commodities.

Bridgewater stated that China's massive stimulus plan has significantly increased investor risk appetite, and the Fed's interest rate cuts have improved global liquidity, enhancing the attractiveness of risk assets.

It also added that while it is currently unclear whether China's stimulus measures will be accompanied by strong fiscal support to sustain the market recovery, the overall policy environment in China is expected to remain accommodative, which is relatively favorable for risk assets