Shanghai Pudong
With an estimated $1.25-billion in mutual fund net redemptions in May, it looks like investors are getting jittery once again. (You can read more here.)
Some of the nervousness obviously stems from the debt crisis faced by Greece and other euro-zone countries.
But some observers, such as Dundee Securities portfolio strategist Martin Roberge, suggest that worries that the European bloc could slow global economic growth are unjustified.
"Despite recent fiscal austerity plans adopted in Europe, we believe the chances that the European bloc would derail and cause a worldwide economic train wreck are small at this point in time," he wrote in a report released Thursday. "We conclude that European economic jitters are overblown and China remains the key."
While drastic budget cuts and fiscal reforms are unwelcome by local populations in the euro-zone countries, the economic impact of the austerity programs should "prove contained among distressed PIIGS ( Portugal, Ireland, Italy, Greece and Spain)," Mr. Roberge wrote.
"China is nearly 10 times more important when it come to GDP (gross domestic product) growth contribution. Thus, a successful soft-landing in China is likely to be the catalyst that brings the equity market back on its tracks. Thus, keep an eye on Chinese inflation and the economy this summer."
You can read the full report here: