FXI ETF

Carter Worth, Worth Charting, joins 'Fast Money' to look at the technicals in China and see if it's time to buy into the emerging market stocks.

The US-China decoupling is likely to accelerate under Donald Trump's second term. The Chinese economy is now more vulnerable than in 2017 during Trump's first term, which makes the situation more uncertain. The Chinese stock fund iShares China Large-Cap ETF is likely a value trap, and investors should stay away from it, from the long or short side.

The tight race has resulted in enough liquidity in the ETF world ahead of Election Day.

I am upgrading iShares China Large-Cap ETF to hold, expecting CCP-driven consumer confidence to boost GDP growth, corporate earnings, and stock prices. The Chinese market is better suited for trading rather than long-term investment, given its volatility compared to the S&P 500 and Nasdaq. FXI's portfolio lacks optimal exposure to domestic consumption and tech names, with a weighted upside potential of 13% to YE25 based on consensus price targets.

Despite recent stimulus concerns, Chinese stocks remain undervalued compared to U.S. stocks, presenting a significant investment opportunity. Market obsession with stimulus measures is unhealthy; focus should be on long-term benefits from lower rates and economic fundamentals. Chinese stocks like Alibaba are unfairly punished; the disconnect between company performance and stock price offers value opportunities.

Chinese shares were higher in morning trade, with the Shanghai Composite Index rising 0.45% to 3217.34, as investors watch a key briefing by China's housing ministry

The Chinese stock market indices have reversed higher in striking fashion. But this has all occurred after the Chinese government announced a robust stimulus package.

Tim Edwards, global head of index investment strategy at S&P Dow Jones Indices, discusses volatility in China and valuation trends.

ETFs across various categories pulled in $28.2 billion in capital last week, with U.S. equity ETFs leading the way.