International investment banks are optimistic about emerging market A-share into A-share market

category:Finance
 International investment banks are optimistic about emerging market A-share into A-share market


Da Mo suggests over allotment of a shares

Recently, Morgan Stanley released its global strategy outlook for 2021. The Morgan Stanley strategy team said that it is expected that the global economy will show a V shape recovery next year, the prospect of the new crown vaccine will be clearer and the continuous policy support will provide a good environment for the stock market and credit next year.

For Chinas economy and Chinas market, Morgan Stanley gave a very optimistic forecast. Morgan Stanley raised its forecast for Chinas GDP growth in 2021 to 9% from the previous 8.9%. The investment bank believes that Chinas domestic consumption recovery momentum is still strong, mainly because the government has effectively controlled the epidemic and laid a good foundation for the domestic economic recovery. At the same time, the overseas economy is also continuing to recover, and the growth of foreign demand also supports the recovery of Chinas economy, especially in the first half of next year.

Xing Ziqiang, chief economist of China at Morgan Stanley, said that Chinas economy is expected to maintain a relatively strong growth in 2021, and the RMB may continue to strengthen. Among them, personal consumption will become the main growth point of Chinas economy, and the release of residents savings and the overall recovery of the employment market will be the main driving forces for the growth of personal consumption. He predicted that the simultaneous recovery of global demand will also boost Chinas manufacturing industry, and private capital expenditure is expected to return to strong growth. Meanwhile, the growth rate of infrastructure and real estate construction is likely to slow down gradually. It is mainly based on the following three points: first, Chinas economy will recover steadily; second, the exchange rate of RMB against the US dollar will appreciate; third, long-term structural opportunities.

The MSCI China stock index and A-share are both rated as over matched by Morgan Stanley. Morgan Stanley continues to hold an optimistic position on a shares, believing that the valuation is still attractive. The 14th five year plan will provide support and its weight in the MSCI index may be further enhanced.

Wang Ying, a China market strategist at Morgan Stanley, made a forecast for the relevant markets, raising the target price of a series of Chinese stock indexes covered by it at the end of 2021. Specifically, the latest target prices of Hong Kong Hang Seng Index, Hang Seng China enterprise index, MSCI China Index and Shanghai Shenzhen 300 index will be raised to 28700, 11400, 117 and 5570 respectively by the end of 2021, which means that the CSI 300 index will rise by 11% compared with the current closing price at the end of next year.

To be optimistic about China and the Asia Pacific region has become the standard action of many foreign-funded institutions.

Franklin Templeton, chief investment officer, emerging markets equity ManrajS.Sekhon He said that the performance of emerging markets has been driven by the Asian economy in recent years, and that emerging market stocks have performed well since the beginning of the year, which is more conducive to an effective economic recovery. In terms of epidemic control, major emerging markets, including East Asia, have benefited from the digital transformation of their economies, which has made their anti epidemic performance more effective than other countries. Therefore, the market is optimistic about the prospects of emerging markets in the next few years. In addition, as far as the potential economic performance after the epidemic is concerned, the East Asian market is obviously better prepared to cope with the economic activities after the epidemic, which makes its recovery rate is expected to be faster than that of developed markets, so the prospect is more attractive.

In analyzing investment in science and technology stocks, he said that Chinas technology industry is different from that of the west, especially in the new economy, consumer oriented and digital industries. Therefore, the same set of standards can not be used to analyze western and Chinese science and technology because of their different social and economic conditions. However, Chinas technology is expected to continue to lead the market.

Zhao Yaoting, global market strategist of Jingshun Asia Pacific region (except Japan), recently officially signed the RCEP. This may mean that as many downstream ASEAN economies become more attractive, Chinese manufacturers aiming at China may reconsider their business strategies. RCEP is the first free trade agreement between China and Japan and between China and South Korea. The analysis shows that, in terms of GDP, Japan and South Korea benefit the most, while Taiwan and India, as non signatory countries, suffer the most.

Zhao Yaoting believes that consumer and e-commerce technology will benefit from RCEP. It is estimated that RCEP will increase the regional economy by nearly 200 billion US dollars per year by 2030. He said that with the member countries reducing the tariff of 90% of products to zero in the next decade, the reduction of tariffs entering Chinas domestic market will increase economic activities among countries in the region, including the export of Australian beef and Korean cosmetics. This will enable Asian consumer companies to develop business and seize market share in the region. E-commerce platforms in the region may also benefit as they promote cross-border trade and e-commerce. Although this round of talks did not include e-commerce regulations on antitrust law and consumer credit, RCEP has opened a new market for these companies, which can be used as a catalyst for future growth.

Zhao Yaoting believes that consumer and e-commerce technology will benefit from RCEP. It is estimated that RCEP will increase the regional economy by nearly 200 billion US dollars per year by 2030.

He said that with the member countries reducing the tariff of 90% of products to zero in the next decade, the reduction of tariffs entering Chinas domestic market will increase economic activities among countries in the region, including the export of Australian beef and Korean cosmetics. This will enable Asian consumer companies to develop business and seize market share in the region. E-commerce platforms in the region may also benefit as they promote cross-border trade and e-commerce. Although this round of talks did not include e-commerce regulations on antitrust law and consumer credit, RCEP has opened a new market for these companies, which can be used as a catalyst for future growth.