Goldman Sachs has announced a positive outlook for Chinese stocks, projecting that share prices could increase by 15% to 20%.

This follows a rally prompted by the Chinese government’s renewed pledge to stimulate the economy substantially, contrasting sharply with the occasional economic stimuli observed in recent years.

Financial strategists at Goldman characterize these recent measures as a substantial policy shift.

In their latest investor note, the strategists indicated that foreign investor positioning in Chinese equities is currently below historical averages, making valuations appear low.

As markets prepare to reopen after a week-long National Day holiday, investors eagerly await further stimulus measures anticipated from Chinese authorities.

Among the anticipated topics in the upcoming economic briefing is a suite of targeted policies aimed at improving economic growth and structural balance.

This follows a stimulus initiative that began at the end of September, adding roughly US$3 trillion in market capitalization to the CSI 300 index, which tracks leading blue-chip companies on the mainland.

The index increased from below 3,200 points to over 4,000, with forecasts indicating a potential target of 4,600 within the coming year.

Goldman’s economists estimate that the new measures could boost GDP growth by 0.4 percentage points, noting that each additional 1 trillion yuan (approximately US$140 billion) injected into the economy could deliver benefits.