News

Managers expect China market volatility

China_crashChina’s financial markets resumed trading after the Lunar New Year holiday with managers expecting a degree of market volatility. Early trading saw markets selling off -9% in Shenzhen and -8.7% in Shanghai. “Before the markets opened, Chinese regulators, ministries and local governments announced policy measures to contain the downward impact from the coronavirus on the economy,” said David Chao, global market strategist for Asia Pacific (ex-Japan) at Invesco. “In all, the government announced 30 measures across 5 ministries and regulators to provide economic support,” he added.   A number of provinces in China have halted business activities until February 9, 2020 due to the Coronavirus outbreak. Tai Hui, chief market strategist for Asia at JP Morgan Asset Management is expecting “significant market volatility” in China as it returns from the Lunar New Year holiday. He said: “In addition to investors’ concerns over the impact on corporate earnings from the Coronavirus outbreak, reduced liquidity in the Chinese onshore markets and local investors’ preference for holding more cash could also exacerbate this correction. Sector selection is also important. “Retailers, travel & hospitality services are likely to be the most affected. Yet healthcare and online entertainment could potentially outperform as consumers adjust their spending,” added Hui. In terms of global growth implications, the Coronavirus outbreak “will be significant but relatively short-lived,” according to Desmond Soon, head of investment management for Asia (ex-Japan) at Western Asset, a Legg Mason affiliate. However, the immediate fall-off in short-term global growth momentum is likely to be considerable, given that China is now the world’s second-largest economy and has sizeable trade links with both developed and emerging markets, added Soon. © 2020 funds global asia

Sponsored Profiles

Sponsored feature: Asset allocators – How do you track your decisions?

Apr 06, 2020

Mark Barry, Head of Asset Allocation at Milestone Group, explores how a simple question can highlight opportunities to automate and streamline your asset allocation investment process.

Sponsored feature: How is DLT changing the global securities services landscape?

Oct 17, 2019

By Jeslyn Tan, global head of product management, securities services, at Deutsche Bank

Sponsored feature: A new base for fund distribution

Oct 16, 2019

To get the most value out of the digitisation of investment fund distribution, a blockchain-based infrastructure is fundamental. By Olivier Portenseigne, Managing Director and Chief Commercial Officer, Fundsquare.

Sponsored profile: Bridging the gap

Mar 11, 2019

Private equity is a core part of the business for Caceis’ Hong Kong office, which looks after clients in China and Europe. David Li, chief executive officer, explains why private equity enjoys strong client demand and how it is being used to fund China’s international infrastructure ambitions.

Executive Interviews

Executive interview: Understanding geographies

Apr 06, 2020

Margaret Harwood-Jones, co-head financing and securities services at Standard Chartered, shares her insights on platform standardisation, opportunities in Asia and regulatory change to encourage...

Executive interview: ‘Bull markets don’t die of old age’

Dec 12, 2019

Having a balanced portfolio in the midst of the longest expansion in history is an investment imperative, Chris Alderson, co-head of global equity and head of international equity at T Rowe Price...

Roundtables

Hong Kong roundtable: A ‘fragile Goldilocks situation’

Apr 06, 2020

With the global economy at a crossroads, our panel of experts share their thoughts on the market conditions, geopolitical volatility and growth opportunities. Chaired by Romil Patel in Hong Kong.

Singapore roundtable: A horizon to hold long-term assets

Dec 12, 2019

Panellists discuss the geopolitical fractures concerning asset owners, Singapore as a hub for fintech start-ups and why it makes sense to raise capital from a Variable Capital Company (VCC). Chaired by Romil Patel in Singapore.