Chinese Stocks Poised For Big Gains In 2013!

| January 7, 2013 | 0 Comments

After a disappointing 2012, Chinese stocks are off to a fast start in 2013.  Is this the beginning of a new bull market for Chinese stocks?  There’s plenty of evidence to suggest it is.

Keep reading to find out how you can cash in on this major money making event.

But before we turn to my outlook for Chinese stocks in 2013, let’s take a quick look at what happened last year.

2012 was an up and down year for Chinese stocks.

Shanghai Composite

As you can see, the Shanghai Composite began the year with a nice rally.  It climbed 12% to a high of 2,461 in early March on optimism that easier monetary policy would boost economic growth.

But a turnaround in GDP growth didn’t happen.

Instead of rising in the first half of 2012, China’s GDP continued a decline that had begun in the second quarter of 2011.  As a result, Chinese stocks failed to break through heavy resistance at the 2,470 level in March and again in May.

And the Shanghai went into a six-month tail spin.

By the beginning of December, the Shanghai had fallen to 1,959… a level not seen since early 2009.  What’s worse, the index was sitting on a loss of 11% for the year.

Then a startling thing happened.

Investor sentiment made an abrupt change for the better.  The change was sparked by rise in third quarter GDP and expectations for even higher growth in the fourth quarter.

As a result, Chinese stocks began trending upward off the early December low.  The Shanghai Composite climbed back above the psychologically important 2,000 level and closed out the year at 2,233.

What’s more, the index finished the year with a gain of 3.2%.

But perhaps the most exciting news is that the rally has continued into 2013.

On Friday, the Shanghai closed at 2,277 for a hefty 15% gain off the early December low.  That’s a big upward move in a short period of time.

And if the index can continue rising and close above 2,350, it will mark a rally of 20%.  If that happens, Chinese stocks could be off to the races.

Remember, a gain of 20% would indicate Chinese stocks have entered a new bull market!

How likely is this new bull market scenario?

If the outlook for China’s GDP growth in 2013 is accurate, I think it’s a no-brainer.  Take a look at the following estimates for China’s GDP growth in 2013 and you’ll see what I mean.

In a report last month, the World Bank said “China’s economy is expected to grow at 8.4%, fueled by fiscal stimulus and the faster implementation of large investment projects.”  If correct, that would be a huge jump over 2012’s estimated GDP growth of 7.9%.

And they’re not the only ones expecting stronger economic growth in China next year.

This morning, a Goldman Sachs analyst issued her forecast of 8.1% GDP growth for China in 2013.  A much more bullish outlook compared to her estimate of 7.7% growth last year.  What’s more, she believes stronger GDP growth will drive Chinese corporate earnings up 9% in 2013.

These estimates from reliable sources are strong indicators that Chinese GDP growth is poised for a big rebound in 2013. 

And of course, that would be very bullish for Chinese stocks.

Remember, faster economic growth means stronger earnings growth for Chinese companies.  And stronger earnings usually mean higher stock prices ahead.

So, how can you cash in on this coming trend?

Simple… add high quality Chinese stocks with strong earnings growth potential to your portfolio right away.

Now, if you don’t follow Chinese stocks, this can be a rather daunting task.  After all, there are thousands of Chinese stocks trading on numerous exchanges all over the world.

Fortunately, there’s an easier way… 

Take a quarterly subscription to my investment advisory service that focuses solely on Chinese stocks.  With a subscription to China Stock Insider, you get top-notch research on Chinese companies, specific stock recommendations, regular position updates, and timely sell alerts.

It’s a simple, cost-effective way to add exposure to the coming bull market in Chinese stocks.

Just click here for more information.

And if you act now, you’ll receive two free special reports for 2013 with your subscription. 

Our first report is The Next China Ten-Baggers: 3 Stocks That Could Surge 1,000%.  This in-depth report tells you all about three amazing Chinese stocks with potential to increase ten-fold in value.

Let me just say, you don’t miss out on these potential juggernauts.

And our second report, 3 Chinese Internet Stocks Set To Soar This Year!… well, the title says it all.  This 15-page report reveals three Chinese internet stocks that are poised for huge gains in 2013 and beyond.

That’s six Chinese stock recommendations right off the bat with your subscription.  Of course, as a subscriber, you also have access to all of our past recommendations (many of which are still open positions).

The bottom line…

Chinese stocks are rising rapidly.  But it’s not too late to get in on the early stages of this new bull market.  Whether you subscribe to China Stock Insider or not, consider adding exposure to Chinese stocks before they really take off.

Profitably Yours,

Robert Morris

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Category: Foreign Markets, Stocks

About the Author ()

Robert Morris is the editor of Penny Stock All-Stars, an investment advisory focused on discovering small-cap and micro-cap stocks that are destined to become the market’s next Blue Chips. The Wall Street veteran and small-cap stock specialist is also a regular contributor to Penny Stock Research. Every week, Robert shares his thoughts with our readers on a variety of penny stock-related topics. In addition to Penny Stock Research, Robert also writes frequently for two other free financial e-letters, ETF Trading Research and the Dynamic Wealth Report. He’s also the editor of two highly successful and popular investment advisories, Biotech SuperTrader and China Stock Insider.

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