12 August 2024 | 6:31AM HKT China: Three things in China Three quick highlights from China: ■ Nuances of the July trade data: On the surface, China's July exports missed expectations (7.0% yoy vs. 9.5% Bloomberg consensus) and China's July imports surprised to the upside (7.2% yoy vs. 3.2% Bloomberg consensus). However, the import strength may be related to more working days, and the export miss does not necessarily imply lower export volume. In June, export value increased 8.6% yoy but export volume jumped ...

Investment Rating - The report maintains a base case expectation of the Bank of Japan (BoJ) raising rates at a measured pace, with the next anticipated rate hike of 0.5% expected in January 2025 [2]. Core Insights - Deputy Governor Uchida emphasized that the BoJ will not raise policy rates while financial and capital markets remain unstable, indicating a dovish stance [1][3]. - The BoJ's interest in the US economic outlook has increased, with Uchida suggesting that the US economy is likely to experience a soft landing, which may influence BoJ policy discussions [3]. Summary by Sections Monetary Policy Stance - Uchida clarified that the BoJ's decision-making process remains consistent, stating that the bank will not raise interest rates during periods of financial instability [1]. - The conditions for policy revision include stable financial markets, with Uchida noting that significant movements in stock prices and foreign exchange rates are relevant [1][2]. Economic Outlook - Sustained wage growth is expected to improve, which could align with the BoJ's projections for the economy and prices if financial markets stabilize [1][2]. - The report suggests that the ongoing structural improvements in the domestic economy could satisfy the conditions for policy revision in the future [2].

Equity Research Report Strategy Prospects for Export Chain Trade Huatai Research 13 August 2024 | China (Mainland) Themes Analyst SAC No. S0570520060001_wangyi012893@htsc.com SFC No. BMQ373 +(86) 21 2897 2228 Our core views: export chain to stay resilient, upside to weaken In this report, we analyze the excess return outlook for China's export chain in terms of environment and fundamentals. 1) The win rate of the export chain is 100% amid an increased manufacturing PMI overseas, with excess returns averagin ...

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Equity Research Report Strategy Behind Shifts in Large and Small Cap Styles Huatai Research 13 August 2024 | China (Mainland) Weekly Our core views While the market underwent a pulsed rebound due to policy-driven trading in the middle of last week, sustainability remains to be seen. Recession trading has intensified recently in external markets, yet there has been no sign of inflow into China assets from allocation-oriented foreign capital, necessitating further observation on foreign capital reallocation. ...

Investment Rating - The report indicates a moderate investment rating for the Chinese economy, with expectations of a slight growth improvement in the second half of FY24, tracking GDP growth at 4.6-4.7% [2][4]. Core Insights - The Politburo meeting highlighted the urgency for more easing measures in response to the growth deceleration, with a pledge to reach the FY2024 growth target of 5% [4][25]. - There are mixed perspectives on China's economic outlook, with bullish arguments focusing on potential support for consumption and resilient exports, while bearish arguments emphasize ongoing downward growth momentum and weak domestic demand [2][7]. Summary by Sections Policy Easing - The report emphasizes the need for faster implementation of announced policies and preparation for incremental stimulus measures [5]. - The focus of policy easing is shifting towards household consumption, particularly in services, to promote urbanization and unlock consumption potential [5]. Consumption - The Politburo has called for more support for consumption, indicating a shift in policy focus [5]. - The report suggests that the effectiveness of these measures will depend on the implementation of predetermined policies [4]. Property Market - The impact of the "517 Housing Stimulus" has largely faded, with home sales returning to early May levels and a noted decline in prices [25]. - The report indicates that price adjustments alone may not stabilize the housing market, as they could lead to weaker consumer sentiment and higher risks of mortgage delinquency [25]. Industrial Capacity and Inventory - There is a noted involuntary buildup of industrial inventory due to weak domestic demand, which could negatively impact industrial production [13]. - The report highlights that the YoY growth of inventory has accelerated, indicating passive restocking amid insufficient demand [13]. Tax Revenue - Both corporate and personal income tax revenues contracted YoY in 2Q, reflecting a divergence between real GDP growth and sluggish sentiment [20]. - The decline in tax revenue is constraining government spending capabilities, potentially leading to a deflationary loop in the economy [20]. Construction Activity - Demand for rebar and cement remains at multi-year lows, reflecting ongoing deleveraging in local government financing vehicles and the housing sector [29]. - Infrastructure investment growth is primarily driven by electricity production, while local government construction activity has decreased [29].

Fixed Income Credit Commentary 13 Aug 2024 CMBI Credit Commentary Fixed Income Daily Market Update 固定收益部市场日报 The Asset Asian G3 Bond Benchmark Review 2023 We hope you found our commentaries and ideas helpful. We seek to elevate our efforts and value-add further in the coming year. We highly appreciate your support to us in Sell-Side Analysts of the polls of "The Asset Asian G3 Bond Benchmark Review 2024". Thank you for your support! . Asian IGs were stable and flows skewed to better selling this morning. Ja ...

13 August 2024 | 10:31AM HKT 2131d4eaf4cb4d50b1d51c8af07b64b4 Wistron (3231.TW): Better 3Q24 ahead on AI servers ramp up, PCs and general servers recovery; Product mix and larger scale to support GM We remain positive on Wistron post 2Q24 results and July revenues, which are both in line with our estimates. We expect a better 3Q24 ahead with stronger seasonality, PCs and general servers recovery on new product cycle, and AI servers ramp up on better GPU supply. Although there are still some uncertainties in ...

Investment Rating - The report provides a GDP growth forecast of 4.9% for 2024, indicating a slower growth outlook due to various economic factors [15]. Core Insights - The property sector is experiencing a significant downturn, with sales, starts, and real estate investment (REI) projected to decline by 5-10%, 15-20%, and 5-10% respectively in 2024 [16]. - Consumption recovery remains weak, with offline activities normalizing but overall consumption still below pre-COVID trends, influenced by factors such as income, confidence, and excess savings [17][35]. - Infrastructure fixed asset investment (FAI) is expected to moderate to 5-6% in 2024 from 8% in 2023, reflecting a shift in government support dynamics [18]. - Exports are projected to remain resilient, with nominal exports expected to increase by 3.5% in 2024, supported by robust US growth and ongoing global tech cycles [19]. Economic Indicators Summary - Real GDP growth is forecasted at 4.9% for 2024, with a notable Q1 growth of 5.3% followed by a slowdown to 4.7% in Q2 [15]. - Consumption growth is expected to be 5.1% in 2024, down from 6.4% in 2023, reflecting ongoing challenges in consumer confidence and spending [3]. - Fixed investment growth is projected to stabilize at 3.7% for 2024, consistent with the previous year [3]. - The current account balance is expected to decrease to 1.2% of GDP in 2024, down from 1.4% in 2023 [3]. Sector-Specific Insights - The property sector's downturn is described as the sharpest in history, significantly impacting GDP and local government financing [16][25]. - Infrastructure investment is anticipated to slow down, with a focus on maintaining fiscal support amid weaker local government financing conditions [18]. - Retail sales growth is projected to remain subdued, with key factors such as youth unemployment and cautious consumer sentiment affecting overall spending [35][38]. Policy and Market Dynamics - Major coordinated policy easing measures were implemented in May 2024 to address the property downturn, although the effectiveness of these measures remains to be seen [22]. - The report highlights the importance of addressing inventory destocking in the property sector, with limited progress noted so far [16][25]. - The report emphasizes the need for further policy support to stimulate consumption and investment, particularly in the context of high savings rates and cautious consumer behavior [41].

Global Research and Evidence Lab 13 August 2024 Australian Economic Comment RBA Hauser hawkish: lifts neutral & NAIRU. WPI ticks down to 0.8% q/q, but y/y holds 4.1% RBA Deputy Hauser hawkish: effectively lifts neutral rate & NAIRU estimates RBA Deputy Governor Hauser's speech was on the hawkish side; especially relative to prior comments, which were initially more balanced on the RBA's 'dual mandate' of an inflation target as well as full employment. 1) Hauser characterised inflation as persistent, and hig ...