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UBS Wealth Management: Maintaining neutral position on Chinese stocks, does not recommend chasing high.
UBS Wealth Management stated that it would maintain a "neutral" allocation to Chinese stocks in its Asian investment portfolio.
UBS Wealth Management stated that it is maintaining a "neutral" allocation to Chinese stocks in Asian investment portfolios, and expects market volatility to increase before the Chinese government announces more specific fiscal support measures later this month. They do not recommend investors to chase after high prices, and advise investors to adopt a barbell strategy. Investors who are underweight in Chinese stocks may consider increasing exposure to selected internet and consumer sector companies at low points. From a defensive perspective, they continue to favor high-yield enterprises in the financial, utility, energy, and telecommunications sectors, especially state-owned enterprises benefiting from capital management reform. The latest comments from the investment office of the bank's Asia-Pacific region director pointed out that the market reaction on Tuesday (8th) was obvious. Investors are clearly disappointed by the lack of specific details or commitments regarding strong fiscal actions. However, the record high trading volume of 3 trillion RMB in the Chinese stock market reflects that investors are not sitting on the sidelines. It is expected that there will be more two-way volatility in the market before more specific measures are introduced. These details may be announced in late October or later after approval by high-level meetings and the Standing Committee of the National People's Congress.
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