AsianFin -- Chinese equities are poised to gain momentum from a strengthening yuan, which has remained resilient despite ongoing trade tensions with the United States, according to strategists at Goldman Sachs Group Inc.

A 1% appreciation of the yuan against the U.S. dollar could lift Chinese stocks by as much as 3%, driven by improved corporate earnings prospects and increased foreign capital inflows, Goldman strategists led by Kinger Lau wrote in a note published Monday.

Earlier this month, the investment bank revised its 12-month yuan forecast to 7 per dollar, up from its previous estimate of 7.35, signaling greater confidence in the Chinese currency’s outlook.