China - Tradeable bazooka, not yet a real bazooka | Research

The loud and attention-grabbing nature of the PBOC policy surprise hints that the senior levels of the Chinese government have likely recognized the urgency of the need to act. We think this is a tradeable equity rally worth chasing over the next 1-3 months.
However, the easing measures do not address China's fundamental problems. There are two missing ingredients for a sustained economic rebound.
First, private sector sentiment remains very weak given that there is a political/geopolitical component to the lack of animal spirits (not just an economic component).
Secondly, land sale revenue - the lifeblood for local governments - have fallen rapidly for the past 3 years and are yet to recover.
In terms of global implications, this does not change our macro regime, which remains neutral (i.e. neither risk-on, nor risk-off). PBOC policy is one of the components already captured in the policy regime.