Mary Manning

Asian markets have begun trading again after the Chinese New Year break. Last year was a difficult year for Asia but the outlook for the Year of the Pig is decidedly different. The US Fed is becoming increasingly dovish, the US Sino trade war is de-escalating, China may announce monetary... Show More

Mary Manning

Asian markets have had a very strong year, up 29% year to date in 2017 (in AUD terms). This performance has been driven by a combination of strong earnings growth and moderate multiple expansion. Outstanding market performance in China and India and strong sector performance in the Asian mega-cap technology... Show More

Mary Manning

While the world was watching the outcome of the US Presidential election, a momentous policy change was announced in India. On November 8th, the Modi government announced that all 500 and 1,000 rupee notes would no longer be legal tender. Existing notes must be exchanged at a bank for new... Show More

Hi Lloyd, Appreciate the question. I think the Chinese Government is very conscious not to repeat the mistakes of past easing cycles where excessive borrowing was allowed in order to stimulate economic growth. The Chinese government has worked hard over the past 3 years to clean up the financial system. Measures such as deleveraging at state-owned enterprises and local governments, reducing excess capacity in heavy industries and tightening regulations on lending practices are structural. As such, policymakers will be more cautious and selective in their stimulus actions this easing cycle. This will likely mean a greater focus on fiscal policies such as tax cuts to support domestic consumption and modest infrastructure spending along with some minor monetary easing measures such as RRR cuts. These measures should see China’s economic growth improve throughout 2019, particularly if we get a positive resolution in the US/China trade dispute.

On This could become a FOMO rally very quickly -