Chinese fund managers have raised suggested equity exposure for the next three months to the highest since June as the economy shows further signs of stabilising and as restrictions on home purchases push investors back into stocks, a monthly Reuters poll showed.
The fund managers increased their suggested equity allocations for the next three months to 76.9 percent, up from 72.5 percent a month earlier, according to a poll of eight China-based fund managers conducted this week.
Meanwhile, they cut their suggested bond allocation for the coming three months to 3.8 percent from 11.3 percent a month ago.
Recommended cash allocations swelled to 19.4 percent from 16.3 percent in the previous month.
"Short-term opportunities in the market outweigh risks," said one fund manager, pointing out that stock markets have became more attractive as more cities impose restrictions on house purchases to curb a sizzling property rally.
Bond prices had also started to look frothy.
Another fund manager in Shanghai said the stock market represents a good buying opportunity thanks to mild inflation and an improving corporate profit outlook, which has also helped lure money out of the bond market.
China's blue chip CSI300 index was on track to post an eighth straight weekly gain and has climbed to the highest level in 11 months.
Profit growth in China's industrial sector was up nearly 10 percent to 616.1 billion yuan($89.38 billion) in October, aided by stronger sales and higher prices, the National Bureau of Statistics (NBS) said in a statement on Sunday.
The fund managers suggested a 20.6 percent exposure to financial stocks, the highest in two years, and an 18.1 percent exposure to tech stocks.
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