Weekly Market Summary

💡1. Chinese stocks fell into bear territory this week from a peak in February on a combination of factors including tech crackdown and economic head winds; have been upgraded by strategists at Credit Suisse who cited policy loosening, cheap valuations and stronger economic recovery momentum as their reasons. Credit Suisse reverses downgrade calls in November 2020 and February 2021 that helped investors sidestep sell-off. The upgrade reflects its bullish 12-month view of the MSCI China Index, the broadest measure of onshore and offshore stocks. The gauge, with 739 members and US$2.5 trillion in capitalisation, has dropped 4.6 per cent this year following a 22 per cent setback in 2021.

💡2. M&A deals in China hit record as nearly 20 per cent to 2,381 in 2021, the most since records began in 2006, according to Merger market. The value rose 13 per cent to US$545.2 billion, the second-highest ever. The increase in deal making was attributed to the consolidation of infrastructure, and technology, media and telecommunications firms as well as a record-breaking upswing in private equity buyouts and the government’s domestic policies. The US$111.5 billion merger between Sichuan Railway Investment Group and Sichuan Transportation Investment Group was the largest deal in China and the world

💡3. The official manufacturing PMI fell to 50.1 in January, down from 50.3 in December. Within China’s official manufacturing PMI, a sub index for production in January fell to 50.9, down from 51.4 in December, while a sub index for new orders came in at 49.3, down from 49.7 in December. US manufacturing activity fell to a 14-month low in January amid an outbreak of Covid-19 cases. While the surveys says, Euro zone manufacturing activity accelerated last month as supply chain bottlenecks eased, although the improvement was not evenly spread across member countries and factories still faced high inflationary pressures.

💡4. A proposed new screening regime for American outbound investment risks harming investment relations with China. The so-called National Critical Capabilities Defence Act (NCCDA) was introduced last year amid heightened geopolitical tensions and concern about pandemic-driven disruptions to production of critical goods. A new analysis has found that up to 43 per cent of American investment in China between 2000 and 2019 would have merited review under the act. US firms are also likely face greater legal and compliance costs, while the US-China investment environment will change.

                                   
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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?” 

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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.