October, 2013 (Chinavestor) We said in the last Newsletter that upside looks limited for Chinese stocks for the fall, and we stick to it. September was a particularly good month for Chinese equities despite ending the month sharply lower in the last week. The Shanghai Composite Index rose 3.6% in September in-line with the China ADR Index. Still both these indexes are still deep in the red for YTD.
The Hang Seng Index (INDEXHANGSENG:.HSI) from Hong Kong advanced 5.2% in September and is back in the black for the year. Despite the good news for the month, Chinese stocks underperformed globally compared to major U.S. benchmarks such as the Dow Jones Industrial Average (INDEXDJX:.DJI) or the S&P 500 Index. This is clearly visible on the chart on this page, depicting the DJIA along key Chinese indexes. The Dow has been in the black for all of 2013 and is up 15.5% YTD, a far cry from the performance of Chinese indexes.