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China

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Questions From Europe, Canada, California

Investors around Europe and North America are concerned that the stock market is increasingly overbought and vulnerable to exogenous risks. We agree and have good reasons to fear that festering geopolitical risks and the US election season will deal negative surprises.

Geopolitical Strategy by Matt Gertken
Base Effects Boost Chinese Industrial Profit Growth
Chinese industrial profit growth surged to 10.2% y/y in the first two months of the year after having contracted by 2.3% in 2023. Does this rebound in profits suggest that investors should become more optimistic about the Chinese economy and risk assets? A…
Daily Insights
China: Yuan Slide Signals Greater Tolerance For Currency Weakness
Image The Chinese yuan slide sharply against the US dollar on Friday, breaching the 7.2 level. The weakness comes after the PBOC loosened its hold on the currency by setting a weaker-than-anticipated daily fixing. The…
Daily Insights
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A Tug Of War

Despite a couple of rate cuts in H2 2024, borrowing costs will remain elevated in real terms amid lower inflation in the US and Europe. This and tightening fiscal policy will hinder domestic demand in advanced economies. Domestic demand in China and EM ex-China will remain very tepid, with risks skewed to the downside.

Emerging Markets Strategy by Arthur Budaghyan
Chinese Housing Market: A Fourth Year Of Contraction?
According to BCA Research’s China Investment Strategy service, the adjustment in China’s real estate sector is not over. Odds are that the property market will contract for the fourth year in a row. The property market indicators continue to paint a grim…
Daily Insights
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China: Living With Deflation

Deflation remains prevalent in the Chinese economy. The longer authorities delay a big bang-type stimulus, the more entrenched deflation will become. Hence, a cyclical upswing in Chinese stocks is unlikely, although there might be short-term rebounds.

China Investment Strategy by Qingyun Xu
China IP Growth Tops Expectations But The Property Market Remains Frail
Chinese economic data for the first two months of the year were mixed. On the one hand, industrial production and fixed asset investment growth came in above consensus estimates, accelerating to 7.0% y/y (vs. expectations of 5.2% y/y) and 4.2% y/y (vs.…
Daily Insights
Disappointing Singapore NODX Hides Positive Dynamics
Singapore non-oil exports (NODX) largely disappointed in February, contracting by 4.8% m/m following a 2.3% m/m expansion in January, and falling below expectations of a milder 0.5% m/m decline. In a similar vein, the 0.1% y/y decline in February fell below…
Daily Insights
Is Dr. Copper Sensing A Chinese Recovery?
In a recent Insight we highlighted that the selloff in the price of iron ore – which is down 25.4% year-to-date – is sending a pessimistic signal on China’s economy, suggesting that the current rally in Chinese stocks is unlikely to persist over a cyclical…
Daily Insights
Chinese Credit Demand Remains Muted
Chinese private sector credit demand remained weak in February, sending a negative signal about domestic economic conditions. Total social financing growth slowed from a record CNY6.5 trillion in January to CNY1.56 trillion, below consensus forecasts of…
Daily Insights

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