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China ETFs showed resilience Wednesday despite escalating trade tensions between the United States and China that have rattled global markets.
According to etf.com data, major China ETFs posted single-day gains between 1% and 4.6% shortly after markets opened Wednesday, even as the broader market reacted to new retaliatory measures. This comes after President Donald Trump imposed a cumulative 104% tariff on Chinese goods, prompting Beijing to announce an 84% levy on U.S. imports.
The morning bounce in China ETFs amid President Trump's trade war shows how markets can move against expectations, while the monthly data tells a clearer story of investors pulling money from China-focused funds.
China ETFs Rise in Face of Outflows
The KraneShares CSI China Internet ETF (KWEB), which tracks Chinese internet companies, gained 0.9% Wednesday afternoon despite suffering outflows of $524.7 million over the past month and a 23.6% decline during the same period.
Similarly, the iShares China Large-Cap ETF (FXI) increased 2.8% despite seeing $408.6 million in outflows over the past month while falling nearly 20% in value.
The iShares MSCI China ETF (MCHI), with $5.3 billion in assets under management, rose 2.3% Wednesday afternoon while also showing a nearly 20% drop over the past month, according to etf.com data.
Diverging Tech Performance
The most dramatic contrast appeared in the technology sector, where the Invesco China Technology ETF (CQQQ) showed the strongest daily gain at around 5% despite having the worst monthly performance—down 27.2% over the past 30 days.
Source: etf.com
Notably, the Xtrackers Harvest CSI 300 China A-Shares ETF (ASHR), which provides access to mainland Chinese stocks, showed the least monthly damage, down 12.4%. It attracted $204.9 million in inflows over the past month despite recent outflows of $102.7 million during the last week.
This tension between monthly declines and today's upward movement reflects investor uncertainty as markets process the rapidly evolving trade situation. The European Union has also approved its own retaliation against U.S. steel and aluminum tariffs, adding to fears of a broader global trade conflict.