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There is a Chinese saying, when the tree is big, it attracts the wind. Similarly, being the 2nd largest economy, China is perpetually at "war" with many countries - US (whoever is the President, there will still be sanctions and disagreement), Taiwan (could we see a re-enactment of Hong Kong riot once more), South China Sea, etc ?
So, China need more ammunition than ever and thus it make sense to increase the budget substantially. However, riding on this trend does not mean it gives us a sure win route as evidenced by the two largest Defense stocks in China. Both have fallen from it peak for more than 50-70%.
I am keeping these two stocks in my watchlist for now.
Please DYODD
There is a Chinese saying, when the tree is big, it attracts the wind. Similarly, being the 2nd largest economy, China is perpetually at "war" with many countries - US (whoever is the President, there will still be sanctions and disagreement), Taiwan (could we see a re-enactment of Hong Kong riot once more), South China Sea, etc ?
So, China need more ammunition than ever and thus it make sense to increase the budget substantially. However, riding on this trend does not mean it gives us a sure win route as evidenced by the two largest Defense stocks in China. Both have fallen from it peak for more than 50-70%.
I am keeping these two stocks in my watchlist for now.
Please DYODD