Chinese stocks took a beating this year, but a recovery may not come until the second half of 2019, experts say.

The Shanghai composite and main Shenzhen index are down more than 20 and 30 percent, respectively, this year. That puts Chinese stocks among the worst performers globally, where the S&P 500 is off by more than 6 percent, Japan's Nikkei 225 is down more than 9 percent and the German DAX has lost some 16.6 percent so far this year.

"There's really not much impetus for the market to rebound," said Zhu Ning, professor of finance at Tsinghua University and deputy director of the National Institute of Financial Research. "The sentiment is not recovering, and there is not new capacity. I wouldn't be too optimistic about the market next year."

March is an important month

The U.S. and China have set an early March deadline for reaching an agreement on trade.

However, a trade deal between the world's two largest economies is far from certain, especially after Chinese President Xi Jinping took a relatively defiant tone toward international demands in his key address to the nation this week.

Investors are also on edge about potential interest rate hikes by the U.S. Federal Reserve next year, especially since a stronger U.S. dollar could weaken the yuan. If the Chinese currency falls below the key 7 yuan per dollar level, it would offset the negative impact of tariffs, although it is still not clear if that would help or hurt investor sentiment.

Reference: CNBC

Reade More: https://www.cnbc.com/2018/12/20/next-year-2019-still-looks-tough-for-chinese-stocks.html