https://www.scmp.com/rss/169663/feed John Woods is chief investment officer for Asia-Pacific at Credit Suisse en https://assets.i-scmp.com/static/img/icons/scmp-meta-1200x630.png https://www.scmp.com For a market rally to sustain, it must climb a wall of worry every day, surmounting the challenges, fears and negativity put in its way. Painfully and step by step, it is how bull markets typically develop, evolve and push higher – and this is how China’s equity rally has behaved in recent months. Born out of an expectation last October that Beijing’s detrimental trifecta of zero-Covid, property deleveraging and policy intervention would be remedied, then given hope and oxygen last November by... https://www.scmp.com/comment/opinion/article/3210889/chinese-stocks-climb-despite-wall-worry-how-long-more-will-onshore-investors-wait-wings?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3210889/chinese-stocks-climb-despite-wall-worry-how-long-more-will-onshore-investors-wait-wings?utm_source=rss_feed Wed, 22 Feb 2023 07:45:09 +0000 The US presidential election has been decided – in the eyes of the markets at least – and around the world equities have reacted by surging higher. A Biden presidency and a divided Congress represent the best of both worlds: a centre-left government likely to repair and soothe the divisive legacy of the previous administration, but one, simultaneously, denied the legislative heft promised by the “blue wave” and thus unable to roll back Trump-era tax cuts or implement aggressive tax hikes. As far... https://www.scmp.com/comment/opinion/article/3109229/why-biden-presidency-and-divided-congress-will-boost-asian-stock?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3109229/why-biden-presidency-and-divided-congress-will-boost-asian-stock?utm_source=rss_feed Wed, 11 Nov 2020 06:15:12 +0000 Many Asian economies will take major steps forward in internet connectivity in 2020. This will give a meaningful boost to sectors of the new economy, representing an important theme for investors. Between government support and end-user demand (which is expected to be strong even early in the introductory phase), there should be a speedy commercial roll-out of 5G, or fifth-generation mobile networks, and a fast adoption rate. This will accelerate consumption and delivery of mobile services,... https://www.scmp.com/comment/opinion/article/3041475/asian-governments-seek-speedy-roll-out-5g-benefits-will-be?utm_source=rss_feed https://www.scmp.com/comment/opinion/article/3041475/asian-governments-seek-speedy-roll-out-5g-benefits-will-be?utm_source=rss_feed Wed, 11 Dec 2019 19:00:11 +0000 On May 20, 1970 – a date every Chinese pupil knows by heart – after American and South Vietnamese forces mounted an incursion into Cambodia, Chairman Mao Zedong famously issued a statement, “People of the world, unite and defeat the US aggressors and all their running dogs!”, which was read out the next morning to a 500,000-strong crowd at an anti-US rally in Tiananmen Square. On May 20, 2019, a cheering crowd in Jiangxi province listened as President Xi Jinping called for a “new Long March” and... https://www.scmp.com/comment/insight-opinion/article/3012166/cracking-trade-war-code-why-china-and-us-may-quietly-reach?utm_source=rss_feed https://www.scmp.com/comment/insight-opinion/article/3012166/cracking-trade-war-code-why-china-and-us-may-quietly-reach?utm_source=rss_feed Wed, 29 May 2019 14:00:04 +0000 To understand how China’s equity markets could recover, we first need to understand why they fell. Summoning the courage to re-enter the market after an extended decline is not easy. To do so, one needs the clarity that can only come from taking apart and examining the major sell catalysts and determining whether they remain “live”. Economics, of course, played a big part in the initial sell-off. The two key developments in this area were the slowdown in global industrial production and the... https://www.scmp.com/business/article/2174347/have-chinese-equities-bottomed-out-trade-war-talks-infrastructure-spending?utm_source=rss_feed https://www.scmp.com/business/article/2174347/have-chinese-equities-bottomed-out-trade-war-talks-infrastructure-spending?utm_source=rss_feed Thu, 22 Nov 2018 03:30:15 +0000 “The political object is the goal, war is the means of reaching it, and means can never be considered in isolation from purpose.” -- On War, Carl von Clausewitz, The trade dispute between the US and China will deteriorate before it improves. The jarring re-pricing of technology stocks has further to run. And normalisation of central bank policy will continue to spook the bond market. Why then, am I still positive towards risk? And why do I see currently weak investor sentiment and poor market... https://www.scmp.com/business/global-economy/article/2139687/how-does-astute-get-ahead-curve-china-and-us-get-past-their?utm_source=rss_feed https://www.scmp.com/business/global-economy/article/2139687/how-does-astute-get-ahead-curve-china-and-us-get-past-their?utm_source=rss_feed Fri, 30 Mar 2018 12:00:15 +0000 “Winds moderate to severe, moving east. Visibility poor. Storms possible”.  -- Shipping Forecast, BBC Radio 4, 06:00 GMT every morning. From simmering tensions, to a spat, to a skirmish, to a war. How might trade relations between the United States and its global partners in general, and China in particular, play out in the coming weeks and months ahead? In recent days, depressingly, the likelihood of a trade war between the US and China has escalated. The earlier restraint which ostensibly... https://www.scmp.com/business/global-economy/article/2137490/silver-lining-clouds-if-economies-china-asia-can-pull?utm_source=rss_feed https://www.scmp.com/business/global-economy/article/2137490/silver-lining-clouds-if-economies-china-asia-can-pull?utm_source=rss_feed Sat, 17 Mar 2018 02:02:23 +0000 “No, Mr Bond, I expect you to die,” a line from the 1964 film Goldfinger. Reports of the death of bonds – while commonplace – are greatly exaggerated, in my view. An apparently toxic confluence of rising Treasury yields, widening credit spreads, and fears that the asset class had entered the terminal stage of the credit cycle, sparked a spate of obituaries in the press. Inevitably, investors have started to ask whether it is time to unwind holdings in their most beloved of financial assets. I... https://www.scmp.com/business/companies/article/2135362/us-treasury-bonds-are-among-best-portfolio-ideas-right-now?utm_source=rss_feed https://www.scmp.com/business/companies/article/2135362/us-treasury-bonds-are-among-best-portfolio-ideas-right-now?utm_source=rss_feed Fri, 02 Mar 2018 00:52:20 +0000 They say bull markets do not die of old age, but are murdered by the Fed. Last week, inflation-fuelled fears of a greater-than-expected rise in interest rates gave the ageing Bull a severe mauling – particularly in the US – prompting investors to ask whether the global rally in equities was set to roll over; or whether it had the legs to continue higher. Already the longest bull market in the US since the 1930s – extending gains for 106 months, or almost nine years – questioning the longevity of... https://www.scmp.com/business/banking-finance/article/2133499/are-us-feds-knives-already-out-slaughtering-equity-market?utm_source=rss_feed https://www.scmp.com/business/banking-finance/article/2133499/are-us-feds-knives-already-out-slaughtering-equity-market?utm_source=rss_feed Fri, 16 Feb 2018 01:03:56 +0000 If – as Sun Tzu declared in The Art of War – “all warfare is based on deception”, what type of trade war is the US President Donald Trump seeking to wage on his enemies, to make America great again?  Can we expect the full frontal assault deployed, for example, against Japan in the 1980s? Or in these days of asymmetry and misinformation – a strategy the Russians call Maskirova – can we expect something a little less obvious, more nuanced, but packing just as powerful a punch? Certainly, the... https://www.scmp.com/business/banking-finance/article/2131767/art-deal-author-taking-page-out-sun-tzus-art-war-his-trade?utm_source=rss_feed https://www.scmp.com/business/banking-finance/article/2131767/art-deal-author-taking-page-out-sun-tzus-art-war-his-trade?utm_source=rss_feed Fri, 02 Feb 2018 10:00:45 +0000 Among even the most contrarian of investors, there’s a grudging acceptance that the fundamental, valuation and technical architecture framing Asia’s current bull market is broadly sustainable, at least for the next quarter or two. Indeed, standing in front of price momentum year to date, particularly in North Asia, has been like standing in front of a train. Bears have been crushed. In my pre-Christmas column, I suggested a number of reasons why I felt markets could - and should - continue to... https://www.scmp.com/business/banking-finance/article/2129626/make-hay-and-hedge-while-sun-shines-our-markets-change-may?utm_source=rss_feed https://www.scmp.com/business/banking-finance/article/2129626/make-hay-and-hedge-while-sun-shines-our-markets-change-may?utm_source=rss_feed Fri, 19 Jan 2018 02:26:58 +0000 A modest pullback over at the tail end of the year should not obscure the fact that global equities in general and Asian equities in particular delivered an outstanding performance in 2017. According to the MSCI family of indexes, as of mid-December 2017, the US had posted returns of around 19 per cent, Latin America 16 per cent, Eastern Europe 11 per cent, and Europe 8 per cent. Conversely, the MSCI Asia ex-Japan Index (MXASJ) posted a mighty 35 per cent rally during the year, making an... https://www.scmp.com/business/investor-relations/article/2125399/after-such-blockbuster-year-can-asian-stocks-do-it-again?utm_source=rss_feed https://www.scmp.com/business/investor-relations/article/2125399/after-such-blockbuster-year-can-asian-stocks-do-it-again?utm_source=rss_feed Fri, 22 Dec 2017 05:05:27 +0000 This week, in the corporate world, it’s performance review week. Line managers across the globe are sitting down with their team members, scorecards in hand, assessing past year’s performances, and setting targets and budgets for the next. As many of us know, this can be a nervous time, not least because one’s remuneration – if not one’s job – largely depends on a positive outcome. It’s no different in China. This week, the appropriately communist-sounding Central Economic Work Conference kicks... https://www.scmp.com/business/global-economy/article/2124463/evolution-not-revolution-key-fair-grade-chinas-report-card?utm_source=rss_feed https://www.scmp.com/business/global-economy/article/2124463/evolution-not-revolution-key-fair-grade-chinas-report-card?utm_source=rss_feed Tue, 19 Dec 2017 00:04:22 +0000 When I was at school , I chose Spanish as my language option. Spanish, I was told, was spoken by more countries in the world than any other, was soon to overtake English as the primary language in the United States, and reflected the broader excitement around Latin America’s then soaring economic growth. After some five years of study – during which I mastered the phrase “¿Dónde está la gasolinera?”, allowing me at least to fill the car with petrol – Spanish and I parted company on not... https://www.scmp.com/business/article/2123458/chinese-investment-has-be-reduced-and-greater-share-growth-created?utm_source=rss_feed https://www.scmp.com/business/article/2123458/chinese-investment-has-be-reduced-and-greater-share-growth-created?utm_source=rss_feed Fri, 08 Dec 2017 06:11:51 +0000 Should China sneeze, would the world catch a cold? Or catch the flu? Or something worse? I ask, because over the past few months, the flow of economic data from the world’s second-largest economy has been underwhelming to say the least. Just in the last week, a whole slew of industrial, consumer, property, trade, and forward looking sentiment indicators posted either year-on-year declines, or missed analyst expectations, or did both. Inevitably, this has prompted questions about whether China is... https://www.scmp.com/business/banking-finance/article/2121425/what-happens-worlds-economy-should-china-sneeze?utm_source=rss_feed https://www.scmp.com/business/banking-finance/article/2121425/what-happens-worlds-economy-should-china-sneeze?utm_source=rss_feed Fri, 24 Nov 2017 07:45:00 +0000 Over several decades of discussing markets with clients, I’ve noticed one or two personality traits that generally make for a successful investor. The first is the confidence to reject any idea they don’t understand or feel comfortable with, and the second is a willingness to forego the initial upside of a trade by allowing another investor to “cross the road first”. Why take the risk investing in an ostensibly transformational idea when it could so easily fail? It is true that first time movers... https://www.scmp.com/business/companies/article/2119373/successful-investors-use-one-rule-when-it-comes-bitcoin-and-other?utm_source=rss_feed https://www.scmp.com/business/companies/article/2119373/successful-investors-use-one-rule-when-it-comes-bitcoin-and-other?utm_source=rss_feed Sat, 11 Nov 2017 02:47:07 +0000 Was it just me, or did the entire 204-member Central Committee of the Communist Party of China break into their cover version of Queen’s Xi is the Champion at the closing of the 19th Party Congress on Tuesday? No? OK, then it was just me. Yet following the Congress, certainty, no one can be in any doubt of President Xi Jinping’s political supremacy and the vaulting ambitions for his “Chinese Dream,” particularly as it relates to the force projection of China’s influence abroad. In fact, the... https://www.scmp.com/business/global-economy/article/2117278/dont-hold-your-breath-yuan-be-convertible-stability-trumps?utm_source=rss_feed https://www.scmp.com/business/global-economy/article/2117278/dont-hold-your-breath-yuan-be-convertible-stability-trumps?utm_source=rss_feed Fri, 27 Oct 2017 06:00:00 +0000 Things that make you go hmmm… As a young investment bank analyst who really should have known better, I met a couple of institutional clients back in mid-1997, and earnestly explained why I felt Hong Kong’s property prices could not possibly fall. Land constraints, abundant liquidity, low real interest rates, and ample funding all meant, said I, that Hong Kong’s property sector was essentially immune from the chaos then devastating economies across the rest of Asia. One of these gentlemen fixed... https://www.scmp.com/property/hong-kong-china/article/2115234/will-ageing-hong-kong-stop-property-bull-its-tracks?utm_source=rss_feed https://www.scmp.com/property/hong-kong-china/article/2115234/will-ageing-hong-kong-stop-property-bull-its-tracks?utm_source=rss_feed Fri, 13 Oct 2017 08:00:45 +0000 Global growth in the first half of the year has been somewhat weaker than expected. We saw growth slowing much more than we anticipated, the US dollar weakening, bond yields falling. In the second half of 2017, we anticipate a moderate global growth, albeit at a slightly slower pace than that registered in the first half. Somewhat perplexingly, global inflation dynamics continue to print below consensus estimates, but we see this weakness as temporary and believe major central banks will start... https://www.scmp.com/business/banking-finance/article/2102404/next-6-months-invest-higher-rates-expect-protectionism?utm_source=rss_feed https://www.scmp.com/business/banking-finance/article/2102404/next-6-months-invest-higher-rates-expect-protectionism?utm_source=rss_feed Thu, 13 Jul 2017 00:01:55 +0000 As investors wonder how to best handle high valuations of many assets, they automatically turn to thematic investments that can benefit from long-term societal trends. The expectation is that such investments do not depend as much on the daily ups and downs of the financial markets, but seek to profit from the predictability and sustainability of multi-year trends. Demographics, transformational socioeconomic and political developments as well as technological and scientific progress are at... https://www.scmp.com/business/money/markets-investing/article/2094850/these-five-super-trends-will-shape-future?utm_source=rss_feed https://www.scmp.com/business/money/markets-investing/article/2094850/these-five-super-trends-will-shape-future?utm_source=rss_feed Fri, 19 May 2017 00:01:27 +0000 If policymakers across the world were to highlight the single most important challenge facing them today, likely all would identify - in one form or another - the perplexing issue of growth. Europe has too little of it; China has too much of it; Japan has none of it; and, as usual, the mighty US economy appears to have not too much, not too little, but just about enough. The apparent fixation on growth has important consequences for investors, not least the fact that markets are driven by... https://www.scmp.com/business/money/markets-investing/article/1236181/outlook-second-half-sweet-dash-sour?utm_source=rss_feed https://www.scmp.com/business/money/markets-investing/article/1236181/outlook-second-half-sweet-dash-sour?utm_source=rss_feed Sun, 12 May 2013 16:00:00 +0000 Like many a guest arriving late at a drinks function, there's a natural inclination to make up for lost time. And so it is with the Bank of Japan, which joined the global reflation party in early April, with plans to unleash a torrent of liquidity designed to wash away decades of economic underperformance. The impact of Japanese Prime Minister Shinzo Abe and Bank of Japan governor Haruhiko Kuroda's revolutionary new growth strategy has been little short of jaw-dropping. In just six short months,... https://www.scmp.com/business/money/money-news/article/1214720/abenomics-samurai-spirit?utm_source=rss_feed https://www.scmp.com/business/money/money-news/article/1214720/abenomics-samurai-spirit?utm_source=rss_feed Sun, 14 Apr 2013 16:00:00 +0000 Just when investors thought it was safe to get back into equities, the euro-zone crisis returned with a vengeance last week, with Europe's benjchmark Euro Stoxx 50 dropping 3 per cent on February 26, its worst daily loss since mid-2011. The severity of the correction following Italy's shock election results suggests the bulls were caught by surprise. The question now becomes whether the equity bulls can recover their poise and continue to buy; or whether the "Italian job" has fatally undermined... https://www.scmp.com/business/money/markets-investing/article/1173365/italian-job?utm_source=rss_feed https://www.scmp.com/business/money/markets-investing/article/1173365/italian-job?utm_source=rss_feed Sun, 03 Mar 2013 16:00:00 +0000 In Bull vs Bear, specialists argue opposing views on hot market topics. In this first column, John Woods (Citi) faces off against Gary Dugan (Coutts) over whether mainland equities are a good buy Bear view: unsure onshore … Why on earth should investors avoid A shares, or yuan-denominated stocks that trade in Shanghai or Shenzhen? Recent economic data has been surprising to the upside: valuations are cheap; government policies are supportive; and most importantly, the mainland's retail investors... https://www.scmp.com/business/money/markets-investing/article/1125626/bull-and-bear-talk-mainland-equities?utm_source=rss_feed https://www.scmp.com/business/money/markets-investing/article/1125626/bull-and-bear-talk-mainland-equities?utm_source=rss_feed Sun, 13 Jan 2013 16:00:00 +0000 Is now the time to buy China A shares? It's the question on everyone's lips after the Shanghai Composite rose 4 per cent last week, ostensibly on supportive market reforms announced by the government, but in reality on hopes that the mainland's dormant volcanoes - retail investors - are finally ready to start buying. Mainland retail investors, who comprise 35 per cent of the onshore investor base but account for 80 per cent of daily turnover - have had a tough time of it of late. A study of... https://www.scmp.com/business/money/markets-investing/article/1105450/talking-points-china-shares?utm_source=rss_feed https://www.scmp.com/business/money/markets-investing/article/1105450/talking-points-china-shares?utm_source=rss_feed Sun, 16 Dec 2012 16:00:00 +0000 Our love affair with bonds grows more intense by the day. From investment grade conglomerates in Hong Kong to high-yield energy companies in Kazakhstan, our appetite for credit risk - apparently - is unconditional and indiscriminate. We love them so much, there's not enough to go around. For every dollar issued, there's an average eight dollars of demand. Asian US dollar-denominated bonds have returned an attractive 12 per cent year to date and there's nothing wrong with that. The only... https://www.scmp.com/business/money/markets-investing/article/1089213/are-bonds-overvalued?utm_source=rss_feed https://www.scmp.com/business/money/markets-investing/article/1089213/are-bonds-overvalued?utm_source=rss_feed Sun, 25 Nov 2012 16:00:00 +0000 Any landing you walk away from is a good one, but does that apply to China? It's an important question as the country risks a deep economic slowdown. The consensus view now holds that growth will be 7.7 per cent for 2012. Yet the definition of a "hard landing" is a moving target. Two years ago, it was defined as less than 8 per cent growth. Since then, it switched to growth of less than 7 per cent and even 6 per cent expansion, or growth last seen during the Lehman crisis. So let's turn... https://www.scmp.com/business/economy/article/1059624/talking-points-gdp-slowdown?utm_source=rss_feed https://www.scmp.com/business/economy/article/1059624/talking-points-gdp-slowdown?utm_source=rss_feed Sun, 14 Oct 2012 16:00:00 +0000 Buying equities based on hope - for example, the hope of a giant Fed intervention, which pushed up markets last week - is rarely a sound investment strategy. Rather, common sense suggests we should buy stocks based on fundamentals - specifically, their price relative to their outlook for earnings and growth. In periods of weak economic growth and elevated prices, who in their right mind - the logic goes - would buy equities knowing that profit growth was falling? The answer, apparently, is quite... https://www.scmp.com/business/money/markets-investing/article/1036843/talking-points-corporate-earnings?utm_source=rss_feed https://www.scmp.com/business/money/markets-investing/article/1036843/talking-points-corporate-earnings?utm_source=rss_feed Sun, 16 Sep 2012 16:00:00 +0000 After a summer lull comprising four entirely uneventful weeks, local markets finally appear to be waking up to what promises to be one of the most important and action-packed months in, well, months. Local investors will be most focused on whether the imminent prospect of further monetary accommodation by the US Fed, the European Central Bank (ECB), and possibly even the People's Bank of China, signals a buying opportunity. The last round of monetary easing from the ECB in late December 2011... https://www.scmp.com/business/money/markets-investing/article/1031669/talking-points-quantitative-easing?utm_source=rss_feed https://www.scmp.com/business/money/markets-investing/article/1031669/talking-points-quantitative-easing?utm_source=rss_feed Sun, 09 Sep 2012 16:00:00 +0000