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Something for Your Espresso – Asian Equities in the Limelight Again. Is It Finally Time to Buy China?

Asian equities are suddenly in the limelight again as tech optimism grows in China - is it time to get in? We are not far off.
2025-02-18
<a href="https://stenoresearch.com/author/oskarvardal-4851/" target="_self">Oskar Vårdal</a>

Oskar Vårdal

0

Morning from Copenhagen.

The Asian equity frenzy is back in business this morning, as the Chinese tech optimism has returned after a couple of rollercoaster moves over the past week, and we are seeing a lot of analysts revising their performance forecasts for Asian equities upward.

It’s kind of an old story that Asian equities are cheap vs. European/U.S. equities, but nevertheless, the data is worth displaying when we get moves like this, as the underlying fundamentals are looking incredibly strong in Chinese equities from a P/E and earnings yield perspective—even when you adjust it for the risk-free rate.

As the U.S. exceptionalism story slowly but surely fades (as has been the case in 2025 so far), the case for Chinese and European equities is becoming increasingly compelling in our opinion, and the trends in European banks, DAX, and even Hang Seng are looking solid.

Chart 1a: Asian Equities Are Super Cheap

Asian equities are suddenly in the limelight again as tech optimism grows in China – is it time to get in? We are not far off.

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