ETFs focused on investing in Chinese stocks faced significant outflows last week, with the iShares China Large-Cap ETF (FXI) losing $984m and the KraneShares CSI China Internet ETF (KWEB) seeing $710m in withdrawals. Concerns over China's growth outlook, deflationary pressures, and potential US tariffs under a Trump administration weighed on sentiment, leading to a 16% drop in the MSCI China Index since October, as per BBG. There was a bounce in Chinese and Hong Kong markets rebounded Monday, supported by financial stocks and regulatory measures to boost corporate valuations.

• It should also be noted that flows in the first half of October were records highs, following stimulus announcements from the Chinese government.

Chart. China ETF Flows (Source BBG)