Posts tagged China
China – The new elephant on the block gets restless
If you have been following the financial world in the last few months, you are probably already aware that, along with other Asian countries like India, China is becoming one of the most important economies in the world. Forget about America and Europe; China is where the money goes these days. From property investment to industrial development, China has developed one of the strongest investment environments in the world, despite its being highly controlled by the government.
However, experience in previous developing countries has shown that a rapidly-growing economy usually means a lot of pollution. During the Beijing Olympic games in 2008, the constant smog in the city made international headlines more than once. Given the international pressure to reduce pollution globally, China now has to develop its own strategies to deal with carbon credits and the new green economy. While it may not yet be completely ready for a green economy, the Chinese government, along with the private sector, has started to put together strategies to increase interest in green business and sustainability.
These new strategies have resulted in an interesting shift within the Chinese financial world. With their access to capitalist ventures being so recent, Chinese businesses now have to face something that has taken decades to happen in the West. These new challenges contribute to the current restlessness of the Chinese financial market. Interestingly, however, this restlessness makes it the ideal moment for all kinds of investments, especially those related to sustainability and green practices. On the financial side of things, especially active these days are everything related to government funds, carbon exchange derivatives and other financial products that promote innovation in green strategies.
In fact, China is extremely competitive on the carbon market right now. Since they did not have much time to develop a big carbon-emitting industry, it is easier for them to adapt current infrastructures and build new ones following greener guidelines. When looking for property investment advice, make sure that your advisor considers these new factors. In a very short time, they will become very important for investments in China. Investing in properties that focus on efficiency and sustainability is an excellent choice right now, not only in China but in traditional Western markets as well.
It is impossible to ignore China’s new opening towards a market economy. Because it is so new for them, they are able to adapt quite fast to today’s financial challenges. Investing in China is a smart move because the country is developing at an amazing pace. There is a constant increase in investment possibilities, and for anyone who already has one foot through the Chinese door, it is easier and easier to get new opportunities. Anyone with Chinese financial interests should look seriously at the possibilities in green businesses and sustainability; the current and future returns on these investments are definitely worth it. Of course, this also applies in America and Europe: the more people invest in green activities, the less dependent the West will become on carbon-based activities.
Equity market update
Equity market indices witnessed the first weekly decline in 3 weeks. Sensex declined 0.6% for the week to close at 17460 against the last week’s close of 17574.
After last Friday’s decline, the week opened on a positive note but for the week hovered in a range. However bearish sentiments on the last two days took the indices in red.

Conference Board of US corrected its outlook for Chinese economy which led to about 3.36% decline in metal index. Moody’s Investor service placed Spain’s credit rating on review. There are concerns that country’s credit rating will be downgraded. US ISG Manufacturing Index showed a possible decline in manufcturing activity. These factors led to selling in the market.
On domestic front, Indian exports for the month of May grew at 35% which added to the positive sentiments. Banking shares, as expected, traded with negative sentiment due to rate hike concerns. Low weekly inflaton figures however, relieved some of those concerns and created positive sentiments.
Two big stories of the week, rate hike by RBI (read MB update here) and the US Non farm payrolls (which shows a loss in jobs) report came in after market hours and thus these are not factored in this week’s movement. Due to these factors, it is expected that markets would open weak on Monday but then will move in a rangebound manner.
Author:Praveen Bajaj

