[Fasheng Investment Consulting] Global Market Outlook and Investment Viewpoints

Mabrouk Chetouane, head of global market strategy department at Fasheng Investment Management; Bo Zhuang, global general economic strategist at Loomis Sellers

Mabrouk Chetouane, head of global market strategy department of Fasheng Investment Management; Bo Zhuang, global general economic strategist of Loomis Sellers; Mabrouk Chetouane, head of global market strategy department of Fasheng Investment Management ):● The market\’s reaction to the Middle East conflict and the Russia-Ukraine war was relatively muted.
At present, financial markets are mainly faced with the risk of inflation and the risk of stagnant inflation caused by oil and energy prices.
● The European Central Bank is expected to take the lead in cutting interest rates in June this year.
Although economic growth continued to pick up, it was not enough to prevent the European Central Bank from cutting interest rates for a second time.
The U.S. Federal Reserve is expected to cut interest rates in September because the U.S. economy is still resilient and is expected to have a soft landing and not fall into recession or collapse.
● It will be difficult for inflation to fall back to the central bank\’s 2% target in the next few quarters.
Maintaining current interest rate levels and remaining patient have become new strategies for central banks.
● Europe has decided to impose new tariffs on different industries in order to protect its industries, especially those directly related to climate change and environmental protection (and the Paris Agreement) such as electric vehicle, battery and solar panel manufacturers.
The worry is that emerging market countries will also begin to use these new tariffs to protect their markets.
The era of free trade is essentially over.
Bo Zhuang, global economic strategist at Loomis Sellers for Asian markets: ● The U.S. Federal Reserve’s actions affect Asian markets.
Core consumer price index (CPI) has fallen back to levels close to 2% in most Asian countries.
However, the policy of maintaining interest rates \”higher for longer\” in Europe and the United States forced Asian central banks to postpone interest rate cut plans, causing many Asian currencies to depreciate against the US dollar.
● The main risks currently facing mainland China are deflation and overcapacity.
Amid the slowdown in nominal GDP growth, mainland China\’s consumption power is much lower than before and it is no longer the global economic growth engine it once was.
Mainland China will also dump more goods around the world to lower the price of manufactured goods.
Whether Trump is re-elected as President of the United States or not, rising trade protectionism will be a factor that affects investment because we will see more trade wars.
● The current measures taken by the mainland Chinese authorities on the real estate market are still not strong enough to reverse the situation. However, it is expected that the real estate industry in mainland China will gradually stabilize, but recovery will not occur until the first half of next year at the earliest.
Due to the \”long-term sluggish\” economic growth in mainland China and the fact that consumption is the main force driving the real estate industry, it is difficult for the market to rebound quickly this year.
● Gold is currently the only commodity reflecting near-term geopolitical risks.
Not only is the public buying gold, the People\’s Bank of China is also increasing its gold holdings, further solidifying gold\’s status as a global safe haven asset.
Mabrouk Chetouane: ● The main partner of mainland China’s electric vehicle industry is not the United States but targets Europe.
Since European countries will not impose huge tariffs on mainland China\’s electric vehicle industry, the impact of U.S. tariffs on the electric vehicle industry will be quite limited.
Investment Strategy Mabrouk Chetouane:● Optimistic about the Japanese stock market, especially the yen, which will continue to be undervalued.
We believe that the U.S. economy will slow down to a certain extent in the second half of the year and investment in the U.S. market will be slightly reduced.
● The economic performance of European countries will still lag behind that of the United States, but they have the opportunity to perform well in the second half of the year, especially in Europe\’s core value industries such as banking and energy.
● Laying out the technology industry is absolutely essential in the investment portfolio.
● India today is like Mainland China in 2007. The Indian economy is expected to perform well in the coming quarters.
● Latin American countries, Mexico and Vietnam have the opportunity to benefit from the US tariffs on mainland China.
This document is for informational purposes only and should not be construed as investment advice.
The opinions or predictions contained in the article are purely the author\’s subjective judgments and assumptions and do not necessarily conform to the views of Fasheng Investment Management Company or any investment portfolio manager. The investment recommendations may differ from the opinions expressed in the article.
There is no guarantee that events will develop as expected and actual results will differ from those predicted.
The data and analysis contained in this article are not the actual or expected returns of any investment product.
The Company believes that the information provided is accurate and contains information obtained from external sources but cannot guarantee its accuracy and is subject to change without prior notice.

Like (0)
Previous May 22, 2024 11:28 am
Next May 23, 2024 10:30 am

Related posts