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Chinese companies to lead post-coronavirus recovery?

Chinese_factory_workersChinese companies are better poised to recover from the coronavirus pandemic in comparison to their global counterparts, according to a survey by Fidelity International. The pulse survey of 152 Fidelity International fixed income and international equity analysts was conducted between March 7 and 12, 2020. Of the companies they cover, 85% of Fidelity China analysts have a most robust view of recovery. As a result of the pandemic, they expect lower earnings of the companies they cover to be confined to the first half of this year compared to their global peers (42%). “Since China was the first country afflicted by the virus it seems logical it will recover the fastest,” said Fiona O’Neill, deputy head of equity research at Fidelity International. “But the time taken to resume business activity in countries struggling to cope with the outbreak will also depend in large part on the containment measures taken by individual governments.” Fidelity expects the technology sector to be less impacted than others “The technology sector has more recurring revenues that will mitigate liquidity concerns, while sub-sectors such as video games and remote working will see a boost as countries attempt to limit travel and social gathering,” added O’Neill. A host of Asian cities, including Shanghai, Beijing, Shenzhen and the Hong Kong Special Administrative Region have been identified amongst the top 20 leading technology hubs outside Silicon Valley/San Francisco over the next four years, according to a tech survey by KPMG. © 2020 funds global asia

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