Chinese Retail Investors 'Hodl' Stocks In Patriotic Response To US Trade War

Chinese retail investors are flocking to their domestic stock market in a display of patriotism amid escalating trade tensions with the United States.

What Happened: Since U.S. President Donald Trump announced “reciprocal tariffs” on April 2, often referred to as “Liberation Day,” Chinese individual investors have been joining state-backed institutional buyers to defend their stock market against foreign pressures, reported Reuters.

“The goal isn’t to make money. It’s about contributing to my country,” said Cao Mingjie, a home designer from Guangdong province who began investing after the tariff announcement. “Every individual should stand by the country until the end.”

This patriotic investment movement has generated 45 billion yuan ($274 million) in net retail inflows since the April 4 market rout, according to Datayes.

Zhou Lifeng, an investor from China’s northwestern Ningxia region with holdings worth 3 million yuan ($414,000), expressed the sentiment driving these actions: “Being patriotic means holding on to your stocks.”

Why It Matters: The shift comes amid escalating U.S.-China tensions that extend beyond tariffs. Goldman Sachs recently warned of a 66% probability of delisting risk for Chinese ADRs, with an estimated $250 billion in Chinese stocks held by U.S. institutions potentially affected.

The patriotic buying focuses on sectors aligned with China’s national agenda, including semiconductors, defense, and consumer stocks. Meanwhile, Chinese e-commerce giants like JD.com Inc. JD and Alibaba Group Holding Ltd. BABA have announced measures to help exporters pivot to domestic markets.

This retail investor support comes as Chinese Premier Li Qiang has urged government officials to strengthen efforts to stabilize the stock market, and as state-backed institutional investors publicly pledged to increase share purchases.

As tit-for-tat tariffs between the two economic powers surge past 100%, some investors see the market as another battlefield. Hedge fund manager Yang Tingwu, who redirected his portfolio into stocks after the tensions escalated, put it bluntly: “This is war, only without gun smoke.”

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