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China assets act as safe haven as Middle East shock hits oil markets
Chinese assets have acted as a safe haven amid the Middle East conflict, with investors favoring the yuan and government bonds even as oil prices surged.
Since late February 2026, China’s CSI 300 index has fallen only 0.3%, according to market data, compared with drops of about 6% and 9% in Japan and South Korea, respectively, over the same period.
Investors have used the yuan and Chinese sovereign debt as defensive instruments. Large-scale government investment in renewable energy and the electric vehicle sector has helped stabilize assets by reducing the second-largest economy’s exposure to imported fossil fuels, market participants said.
"Global investors are overlooking China's asset classes - equities, currencies, and bonds - as a safe haven," Carey Yung, head of Greater China debt markets at Pictet Asset Management, said. Clarence Li, a lead analyst at T. Rowe Price, added that the recent outperformance of Chinese markets is tactical and may persist in the near term.
Strategic petroleum reserves, estimated at about 1.4 billion barrels, also provide support, according to Macquarie Group. Those reserves are sufficient to cover the country’s domestic needs for roughly six months, Macquarie estimates, offering a buffer against the risk of supply disruption through the Strait of Hormuz.
Published 16 March 2026
© InstaFintech Group
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© InstaFintech Group
