April 13, 2025 05:00 PM GMT The Fintech Radar | Europe Assessing Recession Risks This week we recap Wise's India expansion, our analysis of large cap US payments defensiveness, latest M&A and fundraises, and more … M&A / Fundraises: #1 nettle raises £1.45m in pre-seed round: This week (8th April), London-based nettle raised £1.45m in pre-seed funding. The funding round was led by Project A with participation from top angel investors. The capital raised will be put towards further platform development and sc ...

Investment Rating - The investment rating for Geely is "Overweight" with a target price of HKD 23.00 as of December 2025 [4][45][49] - The investment rating for Changan Automobile is "Neutral" with a target price of CNY 11.50 as of December 2025 [4][56] Core Insights - Geely's Q1 2025 recurring profit is expected to be between CNY 3.2 billion and CNY 3.5 billion, slightly exceeding expectations, while the overall performance appears significantly better due to a substantial one-time valuation gain of CNY 6.47 billion from the integration of Lynk & Co and Zeekr [3][45] - Changan's FY 2024 performance looks better than expected, primarily due to a significant fixed asset disposal gain, but recurring profits are slightly below J.P. Morgan's forecast due to ongoing losses in the new energy vehicle segment [3][45] - The report emphasizes that the key factor influencing stock performance will be earnings surprises, which are expected to lead to upward adjustments in market consensus for companies like Li Auto, NIO, and Xpeng [1][3] Summary by Sections Geely Automotive - Geely's Q1 2025 performance is driven by a strong model cycle and platform strategy, which is expected to help maintain market share [45][49] - The target price of HKD 23.00 is based on a valuation method that considers both traditional fuel vehicle and new energy vehicle segments [45][49] - The expected revenue for 2025 is CNY 359.7 billion, reflecting a 24% increase from previous estimates [52] Changan Automobile - Changan's FY 2024 performance is bolstered by unexpected gains from fixed asset disposals, but ongoing investments in self-owned brands and autonomous driving technology are expected to impact future profitability [3][45] - The target price for Changan is set at CNY 11.50, reflecting a cautious outlook amid ongoing losses in the new energy vehicle sector [4][56] Market Performance - March 2025 wholesale vehicle sales in China reached 2.915 million units, a 37% month-on-month increase, driven by strong growth in new energy vehicles, which accounted for a penetration rate of 42% [6] - The report forecasts that China's total vehicle exports will reach approximately 6.5 million units in 2025, marking a new historical high [3][6]

April 16, 2025 04:09 AM GMT Microsoft | North America 3Q25 Preview – Pushing Through the Chop | What's Changed | | | | --- | --- | --- | | Microsoft (MSFT.O) | From | To | | Price Target | $530.00 | $472.00 | Investor sentiment remains negative as a 'wall of worry' around macro and micro demand impacts dominates the conversation and negative revisions loom on the horizon. Even post our proactive cuts to our estimates, the valuation looks attractive at 25X GAAP CY26 EPS, for a long-term GenAI winner. Key Tak ...

Investment Rating - The industry view for Technology - Software & Services in Europe is rated as In-Line [9] Core Insights - The 1Q25 CIO survey indicates a more muted start to 2025, with IT budget growth expectations aligning with 4Q24, but showing a decline in CIO sentiment due to macro volatility [4][3] - Reseller growth for SAP has slowed to +0.7% year-over-year in 1Q25, down from 3.7% in 4Q24, although other channel checks remain supportive [3] - The best and worst performers in the market last week were OVH Groupe (+22%) and Worldline (-10%), with the overall coverage down approximately 270 basis points, outperforming the market by about 570 basis points [1][8] Summary by Sections 1Q25 CIO Survey - The survey reflects a softening sentiment among CIOs, with expectations for IT budget growth remaining stable compared to 4Q24, but indicating a weakening outlook as macroeconomic conditions become more volatile [4] Company Performance - Hexagon AB reported early demand weakness in hardware sales, indicating broader demand trends [6] - Havas N.V. showed a solid start to 2025 with 1Q25 organic growth accelerating by approximately 3 percentage points compared to 4Q24 [7] Company Guidance - Adyen anticipates a slight acceleration in annual net revenue growth, projecting revenue between €6.69 billion and €6.94 billion for FY25, with an EBITDA margin expected to exceed 50% by 2026 [27] - SAP expects free cash flow of approximately €8.0 billion for FY25, with a cloud gross profit margin of around 76% [29] Market Performance - The overall market performance for the software sector has shown significant fluctuations, with OVH Groupe leading gains and Worldline experiencing notable declines [1][16]

Global Fixed Income Bulletin Tariffs, Tariffs, Tariffs: Waiting (Anxiously) for Clarity MACRO INSIGHT | BROAD MARKETS FIXED INCOME TEAM | April 2025 As this is a monthly bulletin, we will reflect on the events of March but also discuss the market movements that transpired in the first few days of April, particularly following President Donald Trump's "Liberation Day." March proved to be a challenging month for fixed-income investors, as global yields increased broadly and risk assets sold off. Developed mar ...

Investment Rating - The report does not explicitly provide an investment rating for the industry [2]. Core Insights - High tariffs are expected to remain elevated in the short term, posing substantial downward pressure on the economy, leading to heightened market focus on China's policy responses and the direction of the RMB exchange rate [3][11]. - The policy framework is likely to remain reactive, with incremental stimulus measures dependent on economic performance and existing policy effectiveness, suggesting that significant new stimulus may not be introduced until next year [4][12]. - The central bank may allow for a moderate depreciation of the RMB to align with monetary easing, but the potential for disorderly depreciation is considered low due to concerns over capital outflows [13]. Summary by Sections Tariff Impact and Policy Response - The escalating tariffs between the US and China increase the risk of long-term trade decoupling, with the US administration indicating a reluctance to further raise tariffs, complicating China's ability to increase imports from the US [3][4]. - The focus is shifting towards China's policy responses, with expectations that the government will expedite the implementation of existing policies rather than introduce new stimulus measures in the immediate term [11]. Economic Outlook - The GDP growth forecast for this year is set at 4.5%, but it faces downward risks due to the sustained high levels of tariffs, which may lead to a rapid decline in economic growth starting in the second quarter [12][13]. - Incremental stimulus measures are anticipated to be in the range of 1-1.5 trillion RMB, potentially boosting economic growth by 0.5-0.8 percentage points [12]. Currency Management - The central bank has already guided the RMB to depreciate by 0.4% against the USD since April 2, 2025, as part of a strategy to enhance currency flexibility in response to high tariffs [13]. - The forecast for the USD/RMB exchange rate by the end of the year is 7.50, but this target faces upward risks due to unexpected tariff impacts [13].

Investment Rating - The report indicates a cautious outlook for exports, expecting growth to slip below 5% year-on-year in April 2025 [5][8]. Core Insights - Exports surged year-on-year in March 2025, but this is attributed to normalization from the residual effects of the Lunar New Year seasonality rather than a genuine improvement in underlying momentum [3][8]. - The first quarter of 2025 saw export growth decrease to 5.7%, down from 9.9% in the fourth quarter of 2024, influenced by fading front-loading and tariffs related to Fentanyl [3][8]. - Imports showed modest recovery with a growth rate of -4.3% in March 2025, compared to -8.4% in January-February, primarily affected by significant declines in iron ore and coal imports [4][8]. Summary by Sections Exports - March 2025 exports reached $314 billion, showing a year-on-year growth of 12.3%, but the underlying momentum is weakening [7]. - Exports to the US decreased from 10.5% growth in Q4 2024 to 5.0% in Q1 2025, indicating a shift in performance [3][7]. Imports - Total imports in March 2025 were $211 billion, with a year-on-year decline of 4.3% [7]. - Key products contributing to import declines include iron ore (-27%) and coal, reflecting ongoing steel production cuts [4][7]. Outlook - The report anticipates that export growth will soften further due to substantial US tariffs on China, although front-loading in supply-chain trade and electronics may provide some short-term relief [5][8]. - The front-loading of the National People's Congress's RMB 2 trillion stimulus is expected to mitigate the impact of tariffs in the second quarter of 2025 [8].

Investment Rating - The report does not explicitly provide an investment rating for the industry or specific companies covered Core Insights - The report highlights the downside risk to China's growth due to tariff impacts and persistent deflation pressures, with the US imposing significant reciprocal tariffs on China, although some consumer electronics may be exempted [61] - It anticipates slower growth and firmer inflation in the US, driven by tariff uncertainties, leading to a decline in real consumer spending [18][20] - Retailers are significantly exposed to China, averaging around 16% exposure, with gross profit dollars potentially declining by approximately 20% on average due to category-specific blended tariff rates [35][37] - The report indicates that announced tariffs will increase costs for building inputs in the housing sector, which is particularly significant as new homes represent a larger share of the housing market than in decades [31][32] Summary by Sections Tariffs Impact on Chinese Economy - The report discusses the impact of tariffs on China's GDP growth, forecasting a downside risk to the current forecast of 4.5% for 2025 due to persistent deflation pressures [6][7] US Consumer Outlook - Real consumer spending is expected to slow significantly, with increases in prices of imported goods adversely affecting spending [21][24] - Equity market downturns could impact consumption spending among upper-income cohorts, which have seen substantial increases in net worth [26][28] Housing Market Insights - The report notes that new home sales are at their largest proportion of total volumes since before the Global Financial Crisis, indicating a shift in the housing market dynamics [32] Retail Sector Analysis - Retailers face a significant impact from tariffs, with a potential EBITDA downside of 50-70% across various scenarios without offsets [40] - Specialty apparel, footwear, and furniture sectors are among the most exposed to tariff impacts, while beauty, luxury, and staples are less affected [40] IT Hardware Sector - The report highlights that significant assembly exposure remains in China, but US-bound products have diversified to other regions [49] - Recent exemptions have reduced the reciprocal tariff cost burden significantly, leading to a lower average tariff rate for US IT hardware coverage [53][54]

Investment Rating - The report lowers the 2025 GDP growth forecast for China by 30 basis points to 4.2% [1][12] Core Insights - The anticipated additional stimulus of Rmb1-1.5 trillion in the second half of 2025 is expected to partially offset the negative impact of US-China tariffs, which are projected to gradually unwind [1][12] - The report predicts a significant deceleration in quarterly growth from 5.4% YoY in 4Q24 to 3.7% YoY in 4Q25, indicating a 170 basis points slowdown despite policy offsets [12][13] Summary by Sections Economic Impact - The report estimates a 90 basis points growth shock due to tariffs, which will be partially countered by a 60 basis points boost from the additional stimulus [12][13] - The most significant impact on GDP is expected in 2Q, with a projected YoY decline of 0.7 percentage points to 4.4% [12][13] Stimulus Measures - Policymakers are likely to front-load the Rmb2 trillion stimulus package announced at the National People's Congress (NPC) in 2Q, with additional measures expected in the second half of 2025 [14] - Potential measures include modest monetary easing, local construction bond issuance, and targeted support for consumption and infrastructure [14] Tariff Adjustments - The report assumes that the US will lower the weighted average tariff hike on China to 34% by year-end, with significant cuts expected in the next 1-2 months [12][13] - The effective tariff hike is projected to decrease from current levels, which will help mitigate supply shocks and facilitate trade negotiations [3][12] Currency Outlook - The year-end USDCNY target is maintained at 7.5, with a front-loaded depreciation expected to 7.4 by the end of 2Q [15] - The People's Bank of China (PBoC) is anticipated to manage RMB depreciation carefully to avoid disorderly capital outflows [15]

April 13, 2025 08:38 PM GMT Investor Presentation | Asia Pacific M Foundation What Stimulus Can We Expect? Related reports: What Stimulus Can We Expect? (11 April 2025) For important disclosures, refer to the Disclosure Section, located at the end of this report. Morgan Stanley Asia Limited Robin Xing Chief China Economist Robin.Xing@morganstanley.com +852 2848-6511 Jenny Zheng, CFA Economist Jenny.L.Zheng@morganstanley.com +852 3963-4015 M Large Growth Drag from US Tariffs Downside risk to our 2025 GDP for ...