China poses key risk for investors

Neuberger Berman multi-asset class CIO Erik Knutzen said the importance of China to global investment markets was evident from the market reaction to "marginal changes to Chinese growth at mid-year [2015]" as well as to the devaluation of the yuan.

"Our view is that China is slowing but that it is not going into a hard landing, and that it will continue to be a contributor to global growth on the margin," Mr Knutzen said.

But Neuberger Berman equities CIO Joe Amato was not so sure, arguing that "you can't take a hard landing off the table".

"This is an economy that is moving from an extraordinary level of investment-driven economic activity to one that needs to be driven by consumer activity, and that is a very tough transition to make," Mr Amato said.

"The government's policy intervention has reduced that risk, but I think it's still there," he said.

Neuberger Berman fixed income CIO Brad Tank said it is very important to separate China's "very speculative" stock market from what is going on in the real economy.

"The shift [to a consumer-driven economy] is going to take years and will result in lower, more stable growth," Mr Tank said.

"But I think China for the foreseeable future is going to be a source of periodic volatility or uncertainty for the markets, in part because policymakers there are still figuring things out," he said.

An accompanying report by Neuberger Berman noted that China's official estimate for GDP growth for 2016 is 7 per cent, but markets are "more pessimistic", discounting the rate of growth to between 4 and 5 per cent.