Financial Post | Business

Investors are returning to the largest Chinese exchange-traded fund in the U.S. at the fastest pace in almost two years on signs a government stimulus program will support growth in the world’s second-largest economy.

The iShares China Large-Cap ETF has attracted a net $518 million in August, putting it on track for the biggest monthly inflow since $1.34 billion was added in December 2012. The ETF, which has Tencent Holdings Ltd. and China Mobile Ltd. among its 25 stocks, reached an 18-month high on Aug. 13 after rallying 26% from a March low. The Bloomberg China-US Equity Index rose 0.5% as of 9:49 a.m. in New York, extending its advance since the end of July to 3%.

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Investors are speculating that Chinese equities will extend gains as Premier Li Keqiang’s government has promoted railway spending, cut some banks’ reserve requirements and reduced taxes to protect an annual growth…

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