Patrick Pan, China-equity strategist at Daiwa Capital Markets, Hong Kong, does not expect strong outflows from China to other emerging markets (EMs) in the near term.
China's onslaught of regulatory crackdowns on tech companies rattled global markets this week when it announced some curtailing measures on after-school tutoring institutions and asked them to convert into not-for-profit companies.
Speaking in an interview with CNBC-TV18, he said, “Many investors, who are familiar with the China markets, believe that the sell-down was just temporary and also believe that the regulations are not going to spread to other areas in the near-term. So, at least, in the near-term, we do not see strong capital outflows from China to emerging markets.”
“Foreign investors are worried about China’s regulations; they wonder if the sector regulations will expand to more areas. However, we see regulations consistent and unlikely to spread to more areas. So the sell-off driven by the market sentiment is almost over,” said Pan.
For the entire interview, watch the video.