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China A50 star performer for 2014

Asian markets have performed reasonably well this year. More than half have outperformed Wall Street and most of them are set to end the year in positive territory.

China flag
Source: Bloomberg

The star performer in Asia was the China A50 which was led by a strong showing by the financial sector, amid expectations of further stimulus measures.

The basket of the largest 50 A Share Chinese companies by total market cap is pushing five-year highs after jumping 58% over the year.

It broke through the key 10,000 point level earlier this month, after a streak of 13 positive sessions that provided a 36% lift.

Among the worst performers was Malaysia’s KLCI, which suffered a 5.4% dip that was largely driven by the oil and gas sector.

South Korea’s KOSPI also underperformed. It dropped 4.8% over 2014, extending the loss of 0.6% in the previous year. A slump in corporate earnings had hit sentiment, which was compounded by a weaker yen posing more competition on the export front.

Index

Current price

Year-to-date %

China A50

11242

58.3%

Shanghai Composite

3165.81

49.6%

CSI 300 3457.55 48.4%
Nifty 8248.25 30.8%
Philippines SE Index 7230.57 22.8%
Jakarta Composite 5226.94 22.3%
Thailand’s SET 1497 15.8%
China H-shares 11844.10 9.8%
Nikkei 225 17450.77 7.1%
STI 3366.11 6.3%
ASX 200 5420 1.4%
Hang Seng 23501 0.8%
KOSPI 1915 -4.8%
KLCI 1766.83 -5.4%
     
MSCI Asia Pacific 137.88 -2.5%
Dow Jones Industrial Average 17983.07 8.5%
S&P 500 2080.35 12.6%

 

Will the China A50 continue its climb?

On a daily chart, China A50 appears to be trading within an upward channel. Any pullbacks, ideally close to the trend line, will make an attractive entry to go long. A potential support level will be the 10,000-point mark, where a clear break below this level will signal a possible trend reversal.

China A50 Chart
Click to enlarge

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