Investors take stock of changes for the better

China's stock market indexes continued to strengthen on Tuesday after surging 5.71 percent the previous day, with the benchmark Shanghai Composite Index closing 0.37 percent higher at 3,345 points, the highest since early February, 2018.

The rare gain on Monday, which was the largest single-day percentage increase since July 2015, has made many analysts believe that China may be technically entering bull market territory after years of meltdown.

The benchmark index has rebounded about 36 percent since the beginning of the year, making it one of the best performers across the world.

Although no one can predict the short-term movements of the A-share indexes, the possibility is high that they, as the barometer of the world's second-largest and most resilient economy, will continue to strengthen in the middle and long term.

China has turned out to be one of the most resilient economies in the world amid the uncertainties posed by the COVID-19 pandemic. The world economy may dive into the negative growth territory this year, but China is set to register positive GDP growth, according to the forecast of the International Monetary Fund.

More important, after years of strenuous economic restructuring and industrial upgrading, the Chinese economy has become more consumption－and technology-driven, heralding longer-term resilience and competitiveness.

Reflecting these macro changes, shares of consumption-and tech-related companies have been the best performers in the past year. As the domestic A-share market strengthens, it will in turn contribute to the overall economy, as direct financing through the capital markets instead of bank loans will accelerate the development of the corporate sector, especially the country's high-tech players.

As it has become increasingly integrated into the global capital markets through its inclusion in major global indexes, such as the MSCI index, and the so-called northbound investment, trading from overseas investors via the stock connect program between the Chinese mainland and Hong Kong, the strengthening of the A-share market will benefit global investors.

Amid the great uncertainties caused by the devastating COVID-19 pandemic, the strength of the Chinese stock market, supported by the steady expansion of the Chinese economy, is especially significant and serves as an important anchor for investors in other countries.

Thanks to stricter supervision, the irregularities and fraud that once plagued the A-share market have become less prevalent, and that has helped instill confidence in the long-term vitality of the market. With the Chinese economy faring well and domestic regulators continuing to strengthen their oversight, China is set to play a more important role in the global capital market landscape.