Concerned With China's Economy, This Is BlackRock's Action!

<p>&nbsp;BlackRock Investment Institute downgraded China stocks to neutral from overweight following concerns over the real estate crisis and limited stimulus by the government.</p><p><br /></p><p>In a report released on Monday, BlackRock strategists said ongoing structural challenges and geopolitical risks in China portend a worsening long-term growth outlook.</p><p><br /></p><p>Just last week, the company's think tank expressed hope for China's stimulus measures, saying weak inflation could create room for more policy easing.</p><p><br /></p><p>The company last downgraded China stocks in February to overweight saying there was a short-term chance for China's economy to rebound from the reopening of Covid-19 restrictions.</p><p><br /></p><p><br /></p><p>Even so, the performance of Chinese stocks has worsened since then, with the Hang Seng index plunging more than 20% from its January high and the MSCI China index losing 13%.</p><p><br /></p><p>This follows the country's economy continuing to struggle with the risk of 'default' or debt default in the real estate market and a weak recovery in domestic consumption.</p><p><br /></p><p>Although the government has announced various stimulus measures since July, the impact on the economy has been limited.</p>