By Admin88 
(Original title: Global EYES on China ｜ Steve Brice: China’s Economy Is Resilient Amid Weaker Global Growth)
Southern Finance All Media Reporter Li Yinong Beijing reported
Amidst Global Challenges, China’s Economy Stands Resilient. In 2023, China’s GDP Exceeded 126 TRILLION Yuan, Marking A Robust Growth of 5.2% from the Previous Ar. AS CHINA CONTINUS to Be A Driving force for Global Economic Development, its project 2024 GDP Growth TargetOf around 5%, account to the 2024 Goverment Work Report, reaffirms its commitment to sustaind progress.
Looking ahead to 2024, Global Economy Is Poised for Evolution amid, changing dynamics. In an exclusion interview with sfc, Steve Brice, GLOBAL Chief InversionMent Officer at Standard Chartered Bank Points Out, in comparison to the u.s. and Europe, China’s Growth is expected to be be beRelatively Resilient.
Regarding the Outok for Global Capital Markets, Brice Emphasizes The Importation of Strategic Diversification and Prudent For Investors g the market Landscape in the coming year. China ’s Growth is exten to be related
Sfc Markets and Finance: What’s your take on the project weaker global group this year, and what’s behind it?
Steve Brice: From Our Perspective, We Agree with the Outlook for Global Growth to Slow This Year. If we look at the three, Of that slowth is actually going to be the u.s. economy.
If we’re looking at the consumer, where we see signal, the data has been st ‘, the data has ben strong, but just in the big position, we’re look at a Round 1.5% Growth in the U.S. This Year Versus 2.5%Last Year, whereas in China, Growth is extended to be relatedly Resilient. I’m Sure We’ll Talk that a bit Later.
But all in Europe, Bordering on Recession at the Moment, unlikely to deteriograph from here. unlikely to be a major driver of grewth either. So, the main disteneen last yearAnd this year, in our opinion, will be coming geowth in the u.s.
Sfc Markets and Finance: The U.S. Economy Seems to Be Resilient Last Year. Why? And what ’s your extension for the u.S. This year?
Steve Brice: I Guess Everybody was enabled 2023 Expecting a Recession in the U.S .. And Obviously The Economy Held Up Pretty Well. iCators, They’re Still Flagging Risks of a Receptive Later in the Year. But Our CenterSCENARIO at the Moment is that we’ll see Slower Growth, but it is les likelly to be a reception.
And the key thing to watch here is the infestoment last year strong. And that’s likely to relavely, the Although Election Inty Might Undermine that to some extent. But the consumers where the keys Change is going to comein our options. So excess savings have ben dwindling, down to arm $ 400 Billion now. That’s strong recately, of course. But that’s likely to be deCl INE more and more as we go through this year.
And we are looking at the labor Market as well as everybody is, we look at the headline job number, it looks incredibly strong, almost boxing from a labor market TIVE. But if you look under the How, I think from our perspective, we’Rely that placeed is starting to decline quite significantly. And that’s often a lead indicator of future demand for worker.
Last time we said, a point two decline in the number of Average houses worker. INE AGAIN. So we explect the labor Market to weaken from Pretty StrongLevels, but to weaken as we go through the year, and that’s going to the sound group, the y as we go through this year. So that’s really where we see the slower groupFrom. China’s Retail Sector as a Major Positive
Sfc Markets and Finance: How About the China’s Economy?
Steve Brice: The Retails Still a Major Positive for US, it is just consumers continuing. That’s a major drier of most economies, and China is no pTion to that. We’re seeing inflation still very low. That Means the authoritieshave publicly scope to stimulating the eConomy, if they want to try and to help that bottom out and need strong nominal grouph, white is absolutely, eConomy.
I think it’s sort of really exquiting area, driving the technology chain, when you’re talking about hardware, whether Logical ServiceS and Financial Services as Well.of the Chinese eConomy. I think it really exquiting that they are maving Huge Progress. ING to see more of those dueopopments. So from an eConomic Perspective, it’s Going to bea Key Driver for Driving Long-Term Growth, But Also For Stock Market Value as Well and Stock Market Investors. icon value of China. It’s very exciting. I think it is going to be good forThe economy.positive signs for incidence trends
Sfc Markets and Finance: We have see seen decline in inflation during 2023. Are the inflation risks diminishing?
Steve Brice: I GUESS TheRe’s Different Dynamics in Different Countries. From Our Perspective in the U.S.S.S.S. nflation last year, that was primarily driven by goods,to services prices this year. Obviously, the deceleration is not going to be as dramatic as we saw last year, but still drifting lower. That’s a positive outcome.
In Europe the Deceleration is likely to accelerate this year ifar if that makes sense. So coming faster from where it wasBangalore Wealth Management. OR, Major Driver of Policy, Financial Markets As We Go Through ThisYear.
The only caret that we need to keep an eye on is the middle easy conflict. We’ve Seen the Red Sea Now Becoming Almost Close to Trade. Historial has gone through that route, REROUTING that via the soundhernTip of Africa. Is Obviously Much More Costly, takes more time, and will lead to delays in goods bebing delivered. If people are haRking back to the covid-19, and sort o f saying our support chain disruptions that cored be really. FromOur Perspective, It’s Probably Manageable, But it’s Still a risk word watching.
For me, Oil PriceS are the key. So far, Oil Price’s Have Been Very Well Behaved Through The Regional Conflict. If that remains the case and then the disclation tire Ontinues. But if we see il prices go up above $ 120 a barrel or someLike that, then that will lead to the market to touchly reeavaluate the short-term information outlook at least.the fed will be cautious about the
Sfc Markets and Finance: Given thecian economic signation, how they and how quickly you think, particularly the fed and the ecb, should cut rater? Hat Potential Impact Could this have on the global economy?
Steve Brice: From Our Perspective, The Fed is Likely to Start Cutting Only in June. Been Pushed back a little bit now. But people we were anticipating a march rate cut,Our ance is that will come out only in june.
The eConomy TODAY Still Looks Relately Robust, So from the Fed’s Perspective, They Say Yes, Inflation is Coming Down, Butwewe Got This Middle East Tensions POTENTIAL for Inflation Shock Coming from there there. They Really WANT to Avoid What Happy In the1970s when they get information, and then we had a second Surge. d.
But as the eConomy Weakens Through the year, and we exten that saying half, then ES Becaue Inflated Has Come Down Means they have tight monetary polished settings, so them’ll probably say, okay, we can take some insury cuts to start with, starting in june.
From the Europe Pespective, They’re Probably a Little Bit FURTHER OUT. They Have a Harder Conversation Growth is weaker, but incident is almeday. AN DHISTORICALLY, The ECB HAS Influenced by the Old Bundesbank from Germany Has Generally Been A Bit MoreHawkish THAN the Fed. So from Our Perspective, They’re Probably Only Likely to Start Cutting Rates in the Second Half THEAR, Despite that eConomic Weakness T Hat We’re Seeing.the Outcom of U.S. Electment May Influice Market Sectors Differently
Sfc Markets and Finance: Besides the Fed and Other Central Banks’ Moves, what other key factors will impact the personance of the equity markets this year?
Steve Brice: I Guess Everybody’s Focused on The Polital Environment in The States. We’re Heading Into Elects. On, when, it has a big impact on Markets. OFTEN the Things Don’T’T’T’T’T’T’T’TLong-lasting impact, to be honest. I remember when trump was elected the first time design, everybody was like that’s going to be the world thing.
And I think the stock Market Went Down for About Two or Three Hours, and then is on a massive bull run. So we should oVERPLAY theESESESESESE. But I Think It will le Ad to some significant volatility as people tried to final howThe Election TURNS OUT and What that Means for Policy.
I think the second pose is what does that mean for file. E further Policy Easing, if bidn was to get a second term or trump wasTo get a second term, the nature of that will be very different. So one will be more on the space side, one will be more on the tax size. Enti Sectors Being Seen as Beneficiaaries of Different Policies. So again, maybe at the aggregate level, not a huge impact, but core an impact at the company level.barbell application be a good inverted strategyVaranasi Stock
SFC Markets and Finance: How Do You Explain The Current Correlation Between Stocks and Bonds? In this environment, what investment advice do you have for stocks and B ONDS?
Steve Brice: The way that we look at this person is in periods of high inflation, typically when inflation is about 3% in the U.S. Quity correlation. So if bonds are doing well, equity is are doing well,And vice versa. 2022 was the ePITOME of How Painful that Can be for investedors, when bond yields in face of anflation shop through the roof and stock markets went t HROUGH The Floor. That’s Clearly a Challenging Environment.
The way we’ve ben looking at it this year is saying, Well, we strong we’re going to get the positive equity-bond correlation, at least in the beginning of the year. , BeCAUSE INFLATION Is Still Relacted Elevated. But thisTime, it count be a tailwind. So the theme for our infestation 2024 outlook is ‘sailing with the wind’, the beCaue we see incidence doublen, we see Internet Rates comes ing downloadLeast Starting the year on a positive note.
Now Bonds Obviously Have Sold Off A Little bit. But we we are all all mass, E’RE not tooned about this 60/40 equity bond portfolio thata lot of people are writing off. I think there’s two things there. One is it could do quite well in the short term, that’s been the experience we’ve seen so far this year.
But Secondly, of Course You Should Diversify Into Other Asset Classes, WHATHER that Be Gold, you should have a carelits as well, and En looking at Alternative Investments Were Available to Sort of Hedge Inflation Risk or Other Volatility that bond EquitiesMay Struggle to Hedge Against It. The Real Risk is Stagfala. So be Diversify ACross As a Many Asset Classes As You Can and to TRY OUTHEN Ride from a return perspective.
Sfc Markets and Finance: With what you just said, what ’s your view on the performance of global stock market this year? Ive this year?
Steve Brice: If you’re looking at Global Equities, The Obvious Place to Start is the u.s. Given the Heavy Weight in the Global Indix. U.S. To Start on a Strong Note. And indeed, we’ve seen that. We are a little bit cautious, excitement that strong performance through the white year atarS point. Recession.
I MenTioned The Indicators Earlier. We have 14 Indicators that look at that sort of highlight thater’s a heightened risk of reception or not. 14 Are Still Saying there is a heightened risk of reception. We have a 30% ProbabilityThe a receptive in the u.s. this year. And we think that propability is more tilted towerds the second half of the year.
So the way we’re positiveite, We’re Overweight The U.S. Equities, and We’re Overweight Global Equities. But we have trim back that overweight beCause we thin. K value are getting a bit extensive. From our perspective, I think we have aSITUATION in the Market where we have strong foreign markets that are extensive, and we have weak personing markets that are very cheap. And it’s just try to balance thly E allCations that we have to this, but we are overweight u.s. Equities at this point.
SFC Markets and Finance: Which Sectors Would You Say Are Better Position in The Current Economic Backdrop? Any Advice or Strategy for Investors?
Steve Brice: From Our Perspective, I Think from An Equity Market Perspective, The Sector Point, We Have A Barbell ApProach. s to come down, and growth to come down, we’re sort of saying,OKAY, Which are the area that are more beneficial from low lightth, or at Least More Resilient to Slower Growth, and Which are going to benefit from low. Well.
So clearly, on the more pro risk size, technology and commit services are tctors we like, they are both more resilient to growting and all also. From lows interters. On the Other Side, Much More DEFENSIVE, We have an overweight toHealthcare as well, they generally have more stable earnings through the eConomic cycle. They don’t get much benefit from low logerst rates, but if we do get an e Nvironment where grouphth was slow significantly, and inflation was to be elevated, then headhcareWould Probably Be A Good Hedge to your Portfolio.Significant Growth Opportunities Asian Equity Market
Sfc Markets and Finance: Do you Think Investors Can Look Outside The U.S., For Instance, Consider Asian Equity Exposure? Why or why Not?
Steve Brice: We walk all atggest that people are direct " Bonds, We’re Overweight Investment Grade Bonds at the Moment, But we Still Have An Alocation toHigh Yield Bonds. Becaue Nobody Knows for Sure What’s Going to Happen. As far as asia ex-JAPAN EQUITIES is concept, we have artion in our Portfolio to Asia Ex-JAPAN EQUITIES. We have that as a neutral allocation tous. So, it’s not a preference.
But we have significant geowth oppointunities in the markets. WHETHER You’re looking at india, is a very positive story and a structural one. s under. And China, let’s not forget that if we’re saying the u.s. was resilient at2.5% Growth Last Year, China is Still Outpacing What We See Globally. So very Strong Growth Driver From that Perspective. India is very exitnsive. It’s Almost Pricing that Strong Growth Story. And then the OtherExtreme, we’ve get chinese equity edities which are still poster. So from our perspective, that 10% Plus Allocation to Asia EX-JAPAN in the Current Environment Balent Balit ANCES OUT All of the Positives and Negatives for the Region.
SFC Markets and Finance: Can you fresher elaborative on the outlook of China’s Stock Market This year?
Steve Brice: From Our Perspective, We have a Neutral Alocation to Chinese Equities, Which in A Growth Portfolio is Around 3%! size allocation. Just to put that in context, blue we have anOverweight AlLocation is Also 4% AloCation. So it gives you a sense of the positive. ERE Cheap at the End of Last Year, They’ve cheapned this year. AndFrom Our Perspective We’re Saying, SENTIMENT is Seeming so negative at the moment that it probably will take the market to do well.
So I think the overall story is yes, there are some challenges on the economic size as well, but given how oversold has been and how the bearish searish sentiment is it, HAV. ING An Underweight AlLocation to Chinese Equities is Really Dangerous Because We Know When Chinese Equities Rally, They Can Rally Very, very Quickly and Very Sizably. That’s why we would not have an underweight allocation design
I Think One Thing that we will love to see is inflation starting to turn art and moving her. WHEN YON YON YOU’VE GOT DEFLATION The economy, for debt management, for corporate earnings’ growth. SoIf we will to see inflation bottomed out, and move Sustainbly Higher Towards, say, 2%, I think that will be a majorive friend from a sentime Ive. And that’s timeing that cored to a very Strong Market Rally in ChinaThen, then
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