On this Week’s Market Summary:
💡1. The world’s second largest economy grew by 4 percent in the fourth quarter of last year, slowing from the 4.9 percent growth in the previous three months, and bringing the full-year growth rate to 8.1 per cent in 2021. China set an economic growth target of “above 6 percent” last year after growth hit a revised 2.2 per cent year in 2020 under pressure from the corona virus. The recovery has been losing steam since the second half of 2021 after China’s economy grew by 18.3 per cent in the first quarter. The People’s Bank of China also cut its two major policy rates by 10 basis points, further evidence of Beijing’s intention to stabilise the growth in 2022.
💡2. Hong Kong stocks rose to the highest level in about two months after China cut a key lending rate for a second time in a month and stepped-up infrastructure spending to prop up growth. The Hang Seng Index advanced 1.4 percent to 24,471.41 as of 9.55am local time, approaching a level last seen on Nov 25. The gauge of Chinese tech juggernauts in the city jumped 2.2 per cent, while the Shanghai Composite Index added 0.2 percent. Stocks are headed for the highest level since Nov 25 as Alibaba leads tech peers and property developer’s rally. Since China trimmed one-year loan prime rate for a second time in a month, while the five-year rate fell for the first time since April 2020 as policy easing gathers momentum.
💡3. The ETF between the Singapore Exchange and Shenzhen Stock Exchange will not feature fixed income ETFs or real estate investment trust products, potentially tempering enthusiasm for the scheme in its initial stages. The two bourses signed a memorandum in December to develop an ETF connection allowing investors in Singapore and China to access feeder ETFs listed locally on each exchange. The agreement comes amid surging growth in the Singapore ETF landscape, with locally listed ETF assets soaring 47 percent to S$12.5bn ($9.3bn) last year, following 57 percent growth in ETF assets in 2020. Six out of the top seven Singapore ETFs by net inflows in 2021 were fixed income or real estate investment trust (Reit) products which accounted for almost three-quarters of net inflows into locally listed ETFs last year.
💡4. Banks in the Asia-Pacific region need to “make up ground fast” in terms of implementing sustainability practices, as their global peers have made significant progress, according to Mazars. The region’s lenders scored lowest in the categories of governance, risk management and disclosure, according to the report. Asia-Pacific ‘faces a lack of standardised regulation and reporting methodology’, says the report. The report said there were “significant discrepancies” in the region and most banks have identified environmental targets for their activities, but only about a quarter of them have set net-zero financed emissions targets, in line with the Paris Agreement objectives.
One of the must-ask interview questions for banking and finance is: “Have you read any news recently?”, with the follow-up questions: “How would you link this news to the market and what investment suggestions would you give to your clients based on this news?” .
Showing your market sense and ability to provide feasible investment ideas would help to differentiate you from other candidates. Therefore, apart from the weekly news update / investment insights, we have also generated this Weekly Market Summary for you to have a quick understanding of the market development and tips to answer some hot discussion topics. Take a look of the summary and WhatsApp us in the group if you have questions.
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