Market Sours On China
Earlier this year, the talk of the town was China’s “reopening,” where the country did away with its COVID-19 lockdown measures and set its eye on growth. That optimism lasted through April, but as more data has emerged, the market has turned increasingly sour toward the country. 😝
A prime example of this in practice is Yum Brands vs. Yum China, which operates its Chinese restaurants. The chart below shows the Chinese-based company outperforming early in the year but turning south as we headed into the summer. That underperformance escalated today after both companies reported earnings results.