Yesterday Marc Faber made a bullish call on stocks in Hong Kong. Shares there and in China have been ripping higher over the past week.

Since July 21, the Shanghai Composite Index is up 6.3%.

Shares in China and Hong Kong have languished since 2009 and the Shanghai Composite is still 64% below its pre-crisis peak. There have been many false dawns before but the foreign money appears to be flowing in this time. The ETF ASHR is a DB product that buys the underlying shares (rather than futures like some of the others).

The volume has exploded this week. Today, with two hours of trading left volume is about 10 times the average from mid-July.

ASHR etf

ASHR etf

The question is: Where is that money coming from? My guess is Europe. US-based international investors loaded up on Europe over the last two years but flows have begun to show an exit and with the turmoil continuing in the Ukraine, I don’t think they’re in any rush to get back in.

If that trend continues, it could keep the pressure on the euro.