JPMorgan Chinese (JMC) and Fidelity China Special Situations (FCSS) have both suffered falling share prices. Since mid-January, the former is down 6.9% and the latter has fallen 7.7%.

The market is in part pricing in the economic impact of the deadly coronavirus outbreak on the world’s second biggest economy, where most Chinese provinces have suspended business activities until 9 February and a growing number of countries have imposed temporary travel restrictions to and from China.

Should the number of new coronavirus infections begin to moderate, Chinese shares could recover sharply.

Invesco’s global market strategist David Chao emphasises that the coronavirus ‘is a temporary speedbump in the growth of the Chinese economy in 2020 and Beijing has the monetary and fiscal stimulus tools to counter any significant negative impact that this headwind may bring’.

Targeting companies which are exposed to the growing Chinese middle class, Fidelity China Special Situations has a bias to mid and small caps, although there is also a focus on cash-generative businesses.

Rival JPMorgan Chinese offers exposure to the likes of Alibaba, Tencent and Ping An Insurance.

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